Because clearers will generally try and net payments between themselves and their clients, clearing statistics can never be a complete picture of the depth of the global Over The Counter market for precious metals.

In October 2016, the LBMA announced that Boat Services Ltd (a fully owned subsidiary of Cinnober), in a joint submission with Autilla, had been selected as the chosen provider for trade reporting.

The purpose of trade reporting is to enhance transparency within the market and give interested parties a much clearer picture of the size of the international precious metal markets. The Fair and Effective Markets Review (FEMR) Implementation Report of July 2016 also acknowledged that the LBMA has been “focusing on trade reporting as a priority in response to the market commitment by LBMA members to enhance transparency”.

The LBMA has introduced a new system under which OTC market participants will report trades. The initiative has three clear benefits: it will create an accurate picture of the size and shape of the market; it will promote transparency for existing and potential investors; and it will engender confidence in the liquidity and efficiency of the OTC market.

Initially, all trading members will report their OTC trades. Once the dataset is live in 2018, reporting requirements will be extended to ensure that the data ultimately reflects the size of the global OTC market.

The system is capturing trades through a hub known as LBMA-i, which is powered by financial technology operator Autilla. LBMA Market-Makers have already started reporting, followed by other trading members later in 2017. Following a period of quality checking, it is expected that the first set of data will be published in 2018.

Silver bars held in a vault