Fed's Brainard: Pandemic showed flaws in financial system
|The coronavirus outbreak revealed flaws in the financial system and reforms need to be considered to have better protection against shocks in the future, Federal Reserve Governor Lael Brainard said on Monday, as reported by Reuters.
Additional takeaways
"Outflows from money market funds, in particular, showed ideas like swing pricing, minimum deposits, may be needed to stop redemption runs from developing."
"Overall result showed system was resilient, proved the value of things like central clearing."
"Central clearing platforms could still review margin rules, other requirements, to see what could be improved."
"Stress that emerged in Treasury markets may suggest the need for standing repo or other changes."
Market reaction
These comments don't seem to be having a significant impact on the greenback's performance against its rivals. As of writing, the US Dollar Index was up 0.15% on the day at 91.02.
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