The Federal Reserve Bank of New York applauds today’s announcement from the Treasury Market Practice Group (TMPG) that recommended a number of market practices designed to address and remediate widespread settlement fails in the U.S. Treasury market. The TMPG's efforts have gained consensus across a wide diversity of private sector perspectives, including investors, dealers, securities lenders and clearing banks.
The New York Fed endorses the recommendations put forth today, but notes that this is just the starting point. Implementation of the recommendations will require significant time and follow-up efforts by a wide range of participants.
“We encourage all participants in the Treasury market to support these efforts. I expect that the TMPG will ask market participants to help resolve legal, operational and other issues that arise in the course of implementing the recommendations,” said William Dudley, executive vice president and head of the New York Fed’s Markets Group. “We would hope that market participants will provide the TMPG with such assistance when called on. It is important for all of us to remedy the chronic fails problem that currently constrains Treasury market liquidity and function.”