Categories: U.S. Treasury

President’s Working Group on Financial Markets Releases Report on Money Market Funds

WASHINGTON – In March 2020, short-term funding markets came under sharp stress amid growing economic concerns related to the COVID-19 pandemic and an overall flight to liquidity and quality among investors.  Today the President’s Working Group on Financial Markets (PWG) released a report that examines these events and sets forth potential policy measures to improve the resilience of money market funds and broader short-term funding markets. 

“During March, money markets experienced significant outflows, forcing Treasury and the Federal Reserve to step in to prevent a destabilizing run.  We must now consider reforms to ensure this vulnerability does not threaten financial stability in the future,” said Deputy Secretary Justin Muzinich.

The PWG agrees that while many of the reforms implemented after the global financial crisis increased market stability, the events of March 2020 show that more work is needed to reduce the risk that remaining structural vulnerabilities in prime and tax-exempt money market funds will lead to or exacerbate stresses in short-term funding markets. 

The PWG report released today does not endorse any particular reform, but instead advances the study and discussion of potential policy measures that could address these risks. 

In addition to the Secretary of the Treasury, the PWG includes the Chair of the Board of Governors of the Federal Reserve System, the Chairman of the Securities and Exchange Commission, and the Chairman of the Commodity Futures Trading Commission.

The full report is available here: President’s Working Group on Financial Markets: Report on Recent Events and Potential Reform Options for Money Market Funds .

 

####

IR Press

Share
Published by
IR Press

Recent Posts

Treasury Issues Final Rule Expanding CFIUS Coverage of Real Estate Transactions Around More Than 60 Military Installations

WASHINGTON – Today, the U.S. Department of the Treasury (Treasury), as Chair of the Committee…

2 days ago

U.S. Department of the Treasury’s CDFI Fund and Federal Housing Finance Agency Collaborate to Bolster CDFI Access to Capital

WASHINGTON—Today, the U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) and…

2 days ago

Report on U.S. Portfolio Holdings of Foreign Securities at Year-End 2023

Washington – The findings from the annual survey of U.S. portfolio holdings of foreign securities…

3 days ago

READOUT: U.S. Department of the Treasury Hosts Roundtable Discussion on the Financial Sector’s Response to Recent Hurricanes

WASHINGTON – The U.S. Department of the Treasury hosted a roundtable on October 30 with…

3 days ago

READOUT: Sixth Meeting of the Financial Working Group Between the United States and the People’s Republic of China

WASHINGTON – The United States and the People’s Republic of China held the sixth meeting…

3 days ago

Treasury Sanctions Key Members of La Linea, a Group Involved in Trafficking Fentanyl into the United States

WASHINGTON — Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned…

3 days ago