CHICAGO, Feb. 4 (UPI) -- Powerful bond exchanges in Chicago and Frankfurt have squared off over each other's business in the financial equivalent of a back alley brawl.
The fight started when Eurex, a German-Swiss bond exchange in Frankfurt sought regulatory permission to open a U.S. futures exchange in Chicago, home of the Chicago Board of Trade, the Financial Times said.
Eurex, owned by Deutsche Bourse and the SWX Swiss Exchange, is a challenge to the CBOT because starting Sunday it will trade U.S. Treasury bond and note futures, the CBOT's bread and butter.
On Tuesday, however, the CBOT answered. In a one-two punch calculated to set Eurex back on its heels, CBOT said it would radically cut trading fees and start selling German government bond futures.
The CBOT's decision to launch 10-year Bund, five-year Bobl and two-year Schatz futures takes the fight to Eurex's home turf because the Frankfurt exchange dominates global trading in such products.
"This is very serious," said CBOT head Bernard Dan.
