US Treasuries market faces vulnerabilities, new rule mandates changes

Summary: The US Treasuries market, valued at nearly $27tn, faces vulnerabilities due to increased market size and reliance on hedge funds and high-speed traders. Recent crises, like in March 2020, prompted regulatory action. A new rule mandates central clearing for Treasury trades by 2026 to reduce leverage and ensure trade completion. Critics cite increased costs and concentration risks. The rule aims to enhance market resilience during crises.

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