Traders urge ECB to ease collateral shortage in repo market
The eurozone’s repo and money markets are becoming more dysfunctional and threatens the European Central Bank’s ability to push its monetary policies through markets, an influential trade group has warned.
The International Capital Market Association, which represents the bond market’s biggest traders, said it had become concerned about the functioning of Europe’s €10tn repo markets because of a scarcity of liquid assets, and excess liquidity in the region’s banking system.
ICMA’s warning comes amid fears climbing global interest rates and poor trading conditions have heightened the risk of market instability.
This story originally appeared on: Financial Times - Author:Nikou Asgari
