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Regulators to lay out money market fund reforms in July, Fed’s Quarles says

FILE PHOTO: Quarles, vice chairman of the Federal Reserve Board of Governors, testifies before a Senate Banking, Housing and Urban Affairs Committee hearing in Washington

WASHINGTON (Reuters) – A group of financial regulators will lay out recommendations in July to improve the resilience of money market funds and minimize the chance they will need government support in the future, Federal Reserve Vice Chair Randal Quarles said on Tuesday.

Quarles, in his capacity as head of the Financial Stability Board, said the group will focus on the relationship between money market funds and the short-term funding market, particularly the commercial paper market, after a liquidity crunch led to a run on those funds last March that necessitated government intervention.

(Reporting by Pete Schroeder; Editing by Paul Simao)

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