CDS are used by investors as an insurance policy in case a government or company does not pay back their debts, so big spikes in volumes can often flag rising pressures or broader increases in debt issuance.

EMTA, formerly known as the Emerging Markets Traders Association, said overall transactions were down slightly from the $509 billion seen in Q3 last year, but up more than a third on the $364 billion traded over the second quarter.

The New York-based body did not give any explanations for the changes, but did break down volumes for individual EM countries and for nine largely state-owned companies and utilities.

The largest CDS volumes in the survey during Q3 were those on China at $50 billion which was a 51% increase from the previous quarter and 12% up on last year's equivalent period.

EMTA Survey participants, which included Bank of America Merrill Lynch, Barclays, BNP Paribas, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, ICBC Standard Bank, JPMorgan, Morgan Stanley and NatWest also reported $44 billion in Turkish CDS volumes and $40 billion for Brazil.

Of the nine corporate CDS contracts surveyed, Mexico's state oil firm Pemex saw the highest Q3 volume at approximately $2.3 billion, with Brazil's Petrobras next at $1.2 billion.

(Reporting by Marc Jones; Editing by Lisa Shumaker)

By Marc Jones