So far there are no signs of stress among money-market mutual funds or institutional cash management accounts.
The coronavirus pandemic has already caused the recession to begin, the UCLA Anderson Forecast says in an unprecedented update., the Fed slashed benchmark interest rates by a full percentage point, promised to boost its bond holdings by $700 billion and coordinated central bank dollar liquidity lines to other central banks. But it stopped short of announcing specific measures to alleviate pressures in the commercial-paper market.
U.S. banks had a total of $2.5 trillion of credit commitments to companies that weren’t used at the end of 2019, according to the latest data from the Federal Deposit Insurance Corp. Regulatory filings show about 64% of those commitments had been made by the nation’s four biggest banks: JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc. and Wells Fargo & Co.
Robert Sabatino, head of global liquidity investments at UBS Asset Management, said the market is probably going to need additional support that could lead the Fed to resurrect the “alphabet soup” of programs used during the financial crisis. If the strains continue, more companies are likely to turn to their credit lines for cash, market watchers say.
In the early 2000s, the financing flourished, with the amount of such outstanding debt reaching $2.1 trillion in 2007. But the market screeched to a halt in 2008 as losses on risky U.S. mortgage bonds spread throughout the financial system. After the bankruptcy of securities firm Lehman Brothers that September, the $62.5-billion Reserve Primary Fund collapsed.in October 2008 to buy commercial paper from corporate issuers and restore confidence in the market.
The reforms, however, weren’t designed to contain an economic shock of this scale, BofA’s Cabana said.
Brasil Últimas Notícias, Brasil Manchetes
Similar News:Você também pode ler notícias semelhantes a esta que coletamos de outras fontes de notícias.
Pregnant Katy Perry Is 'Cautious' amid Coronavirus Spread as Orlando Bloom Arrives Home: Source'They will spend time at home together and monitor the situation,' a source tells PEOPLE of Katy Perry and fiancé Orlando Bloom
Consulte Mais informação »
“A Quiet Place Part II” Will Hit Theaters Later Than Expected'I'm gonna wait to release the film til we CAN all see it together.'
Consulte Mais informação »
How the Sunday Democratic debate is different than all the other debatesWhile this is the 11th Democratic presidential debate of the 2020 election cycle, it will be considerably different than the others.
Consulte Mais informação »
Mel Brooks' Son Max Says Stay Home, Save My Dad from CoronavirusMel Brooks' son urges the public to stay home amid coronavirus scare.
Consulte Mais informação »
Judge denies request to postpone Ohio primary voting amid covid-19 concernsJUST IN: A Franklin County, Ohio judge has denied the state's request to postpone until June 2 its primary voting originally slated for Tuesday.
Consulte Mais informação »