Money Fund Industry Draws BOE Scrutiny After March Market Strain

June 9, 2020, 3:30 PM

The multi trillion-dollar money market fund industry was a source of “vulnerability” in the financial system at the height of the coronavirus crisis and demands closer scrutiny, said Jon Cunliffe, a Bank of England deputy governor.

Cunliffe told a web conference on Tuesday that regulators must look at whether the funds are invested in liquid assets that can be easily sold to meet redemptions during times of stress.

There were substantial withdrawals from money funds during the crisis and portfolio managers faced difficulty in selling assets to meet the redemptions. Some of the funds came close to breaching regulatory ...

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