A study by the Bond Market Association (BMA) has found that transparency in trading of European Union government bonds has reached the necessary level, but trading in corporate bonds still lags behind. Anyway, transparency in bond trading still is below that in exchange-traded stocks.

Liquidity and prices will improve as more deals will happen on the exchange as opposed to the over-the-counter market. Besides, in the future more transactions will occur on electronic trading platforms, which, too, will lower the costs of trade execution.

Peter Knez, global head of fixed income at Barclays Global Investors, said that despite the availability of many intraday prices on European corporate paper, the transparency levels are still below those found in equity markets.

“The sort of data that were available for equities 10 years ago is now becoming available for [European] corporate bonds,” Mr Knez said.

The BMA’s study comes ahead of the European Commission reflections on the possible introductions of transparency provisions in the Market in Financial Instruments Directive for bonds and other financial instruments.