BoE’s Furse warns liquidity has become ‘more fragile’ in some markets
There may be ‘unforeseen consequences’ arising from shrinking liquidity
Clara Furse, a member of the Bank of England's (BoE) financial policy committee, says the risk of a drop in liquidity in some markets is not fully priced in, making them vulnerable to sharp corrections.
"There is evidence that liquidity in some key markets has become more fragile," Furse said today during a speech in Birmingham. "There may be unforeseen consequences for the intermediation and market-making functions performed by broker/dealers and investment banks that are a source of market
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