CME sees record debt issuance as a plus

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By Ros Krasny

CHICAGO, April 23 (Reuters) - Record levels of debt expected to be issued by the U.S. Treasury this year should be a plus for CME Group's (CME.O: Quote, Profile, Research) interest rate trading volumes, the firm's chairman said on Thursday.

"We're talking about $2 trillion in issuance coming out from the government," Terry Duffy, chairman of the derivatives exchange operator, told Reuters in a telephone interview.

"People will need to use our products to manage their risk," even if official short-term rates set by the Federal Reserve are held near zero for the time being, he said.

Duffy added that financial markets are "not back to normal" but that various indicators are now "different to the past few months."

In a presentation to analysts after releasing its quarterly earnings on Thursday, CME highlighted the revival in corporate debt issuance and greater stability in key money market indicators.

The spread between the three-month London Interbank Offered Rate and the overnight index swap, or the LIBOR-OIS spread, is often seen as an indicator of the relative availability of funds.