The Japan Financial Services Agency (FSA) published the English version of its FSA Analytical Notes (2026.3), presenting an empirical paper that uses over-the-counter (OTC) derivatives transaction data to develop methods for better understanding market structure and behaviour. The analysis examines OTC derivatives by product type and trading counterparty attributes, finding that during periods of sharp foreign exchange movements within the observation window, currency option transactions involving non-financial corporate participants increased markedly. A multi-layer network analysis also indicates that financial institutions active in OTC derivatives may perform different roles depending on institution type. The FSA indicated it will continue refining its analytical methods and approaches to deepen its understanding of the OTC derivatives market, and will keep building data analysis capabilities and data infrastructure as a medium- to long-term supervisory and policy agenda.
Japan Financial Services Agency 2026-03-06
Japan Financial Services Agency publishes Analytical Notes analysing OTC derivatives transactions and counterparty roles
The Japan Financial Services Agency published an English-language Analytical Note using over-the-counter derivatives data to analyse market structure and behaviour by product type and counterparty attributes. The paper finds that currency option transactions involving non-financial corporates rose sharply during periods of significant foreign exchange movements and that financial institutions play differentiated roles in multi-layer network structures. The agency plans to further refine its analytical methods and data infrastructure as part of its medium- to long-term supervisory and policy agenda.