Markit Launches Valuations Service for Inflation Derivatives

Mark-to-market pricing and asset valuations group Markit has launched a valuations service for inflation derivatives covering UK, US, French and European zero coupon swaps.

The service, part of Markit’s Totem Service aimed at sell-side risk managers and product controllers, provides independent verification of mark-to-market prices for UK RPI (Retail Price Index), U.S. CPI (Consumer Price Index), Euro HCPIx (Harmonized Consumer Price Inflation ex tobacco) and French CPIx (Consumer Price Inflation ex tobacco) zero coupon swaps. Pricing goes out to 30-year maturities, with monthly granularity out to 5 years. Markit expects to add year-on-year swaps and floors by 2006. Twelve of the largest dealers in inflation derivatives are participating in the service.