UK Regulator Sets New Liquidity Rules for Money Funds
The Financial Conduct Authority plans to require money market funds to hold higher liquidity levels to bolster financial stability. Stable NAV funds must maintain 40% weekly liquid assets while variable NAV funds are expected to hold 20% to ensure market resilience.
The United Kingdom will mandate higher liquidity buffers for money market funds (MMFs) to strengthen financial stability. The Financial Conduct Authority (FCA) plans to require stable net asset value (NAV) funds to hold 40% in weekly liquid assets. This shift aims to prevent liquidity mismatches that could destabilize broader markets during periods of investor redemptions.
