Nalm Europe: Markets may be struggling to digest news, warns BoE’s Salmon
If market stress becomes more common, contagion could be an issue
Markets' ability to "digest significant news" may have become impaired in recent months, with the threat of sudden spikes in volatility and drops in liquidity becoming more common, according to Bank of England (BoE) executive director for financial markets, Chris Salmon.
"Recent months have shown the potential for short, sharp shocks," Salmon told Central Banking's National Asset-Liability Management (Nalm) conference in London today.
"But financial markets may not have been truly tested for the
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