Liquidity buffers had mixed impact during Covid-19, ECB paper finds

Higher buffers for funds slowed initial fire sales but had less impact during “peak phase”

European Central Bank

Evidence from the Covid-19 crisis shows that liquidity buffers for investment firms had mixed effects in preventing asset “fire sales”, a working paper says.

Liquidity buffers and open-end investment funds: containing outflows and reducing fire sales is published by the European Central Bank. Lennart Dekker, Luis Molestina Vivar, Michael Wedow and Christian Weistroffer look at eurozone-domiciled funds that on average invested at least 50% of their portfolios in corporate bonds.

They examine

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact info@centralbanking.com to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Central Banking? View our subscription options

Register for Central Banking

All fields are mandatory unless otherwise highlighted

This address will be used to create your account

Most read articles loading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account

.