BIS says central banks should prepare for market-making in crises

Central banks could consider direct interventions in critical markets

BIS in Basel

Central banks should strengthen measures to support market-making in the event of crises, the Bank for International Settlements' Committee on the Global Financial System (CGFS) says in a report.

Liquidity has experienced a "bifurcation" since the global financial crisis, the report says, with growing activity in more liquid instruments but declining activity in illiquid instruments. This has made liquidity more "fragile" and susceptible to crises.

Market factors and regulatory factors are

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