How New Money Market Fund Rules Will Impact the Dollar

The video discusses the potential decline of the US dollar as a reserve currency due to new money market fund rules, which discourage risky investments and increase funding costs. This shift may lead to more funding in other currencies like the euro. The euro has performed well during risk-off periods due to lower interest rates. The video also covers Sterling's recent weakness and liquidity issues in the FX market, highlighting the challenges of balancing market orderliness and execution efficiency. Regulatory changes have limited banks' market-making roles, leaving hedge funds to fill the gap, which may exacerbate market volatility.

How have the new money market fund rules affected institutional funding sources?

What are the implications of the dollar losing its status as a reserve currency?

What factors contribute to the euro's performance during risk-off periods?

Discuss the potential consequences of higher funding costs for institutions.

What challenges do hedge funds face in making markets during illiquid hours?