U.S. regulators approved rules intended to prevent a repeat of an investor exodus out of money-market mutual funds during the financial crisis, addressing one of the biggest unresolved issues from the 2008 meltdown.
Cathy Gregg, a partner at Chicago-based Treasury Strategies, a consultant to institutional clients that use money funds, said she expects an initial pullback from investors. “I think there’s going to be some segment of them who will have to stop using money-market funds because they’re not permitted to invest in a floating rate product like that” according to their investment guidelines, she said.
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