Liquidity concerns still haunt Ficc

Market participants increasingly fear liquidity drought

Parched earth in a dry riverbed

Market participants are growing increasingly concerned about liquidity conditions in fixed-income, currencies and commodities (Ficc), with US Treasuries and corporate bonds seen as most at risk, as regulatory changes have squeezed banks' market-making abilities.

"There has been a step change in liquidity in the markets," says the head of forex at one US bank. "The concern is liquidity is less than what it used to be and less than what it seems at any given moment. A lot of people are worried tha