Opening remarks (via prerecorded video) by Mr Jerome H Powell, Chair of the Board of
Governors of the Federal Reserve System, at the 10th Annual US Treasury Market
Conference, Federal Reserve Bank of New York, New York City, 26 September 2024.
Five Key Ideas:
1. Importance of the U.S. Treasury Market:
Powell emphasizes that the U.S. Treasury market remains the deepest and most liquid globally and plays a crucial role in both U.S. and global economic stability, as well as monetary policy.
2. Historical Reflection:
The conference was first held in response to the October 2014 flash crash in the Treasury market, which exposed structural changes in trading practices, especially the rise of high-speed electronic trading.
3. Interagency Cooperation:
Powell highlights the importance of collaboration between regulatory bodies, which was critical during both the 2014 crash and the COVID-19 market disruptions. This cooperation remains essential for market surveillance and stability.
4. Commitment to Market Functionality:
Powell underscores his ongoing commitment to ensuring the Treasury markets operate effectively, even during periods of stress, reinforcing the need for resilience in market infrastructure.
5. Ongoing Relevance of the Conference:
Powell expresses pride in the conference’s decade-long relevance, highlighting its role in shaping the understanding and policies surrounding the evolving Treasury market.
Top 3 Quotations:
1. “The U.S. Treasury market is part of the bedrock of our economy and indeed of the world economy.”
– This statement captures the global significance of the U.S. Treasury market and would likely be a key point in any analysis of the speech.
2. “October 2014 was a wakeup call because there had never been such a large swing in Treasury prices in such a short period of time.”
– Reflecting on the 2014 flash crash, this quote illustrates the market’s vulnerability and the catalyst for subsequent regulatory attention.
3. “It is essential that our Treasury markets are able to efficiently transform Treasury securities into cash, even at times of elevated stress.”
– This underlines Powell’s key message about the importance of maintaining market liquidity and efficiency during challenging times.
