Tokyo Financial Exchange will launch this month a futures contract tied to the Bank of Japan overnight unsecured call rate (TONA), aimed at letting traders hedge or position for rate moves during the two upcoming BOJ policy meetings. The exchange said existing three-month TONA futures have not met traders’ needs as BOJ policy adjustment has accelerated; the TFX wholesale head said rate volatility and demand for derivatives are rising. Three-month TONA futures volumes have fallen in recent months

Tokyo Financial Exchange will launch this month a futures contract tied to the Bank of Japan overnight unsecured call rate (TONA), aimed at letting traders hedge or position for rate moves during the two upcoming BOJ policy meetings. The exchange said existing three-month TONA futures have not met traders’ needs as BOJ policy adjustment has accelerated; the TFX wholesale head said rate volatility and demand for derivatives are rising. Three-month TONA futures volumes have fallen in recent months, with September volume down nearly 50% YoY despite widespread expectations of further BOJ tightening.