MNI BRIEF: FSB Report Lays Out Menu of MMF Reform Proposals

The Financial Stability Board Wednesday released a consultation report offering a menu of money market fund reform proposals for G20 member countries that is intended to help inform their considerations, but stopped short of recommending a single set of policy changes that all jurisdictions must adopt.

"The consultation report that we're publishing today sets out policy proposals to enhance money market fund resilience, including with respect to the appropriate structure of the sector, and underlying short term funding markets," FSB Chair and Fed official Randal Quarles told reporters. In a holistic review produced in November, the FSB warned G20 leaders to remain on guard against a recurrence of the March of 2020 squeeze, and pointed to money market funds as susceptible to runs that could also give rise to system-wide vulnerabilities.

FSB Chair Quarles said a final report to the G20 will be published in October before taking into account stakeholder feedback.