Wed. Nov 25th, 2020

Planet Compliance

Innovation & Regulation in Finance

FCA reports on liquidity in the UK corporate bond market

2 min read

The FCA has today published a report on liquidity in the UK corporate bond market under the title “Occasional Paper No. 14: Liquidity in the UK corporate bond market: evidence from trade data”.

The purpose of this paper is to contribute to the ongoing debate on liquidity in financial markets by shedding light on a market that has not been studied in depth. By leveraging the transaction level data available to the FCA as the national competent authority, the FCA analyses the evolution of liquidity in UK corporate bond markets for the period 2008–2014. On the basis of a series of widely accepted liquidity measures, the regulator documents that, although the inventory of dealers has declined in this period, there is no evidence that liquidity outcomes have deteriorated in the market. If anything, the market has become more liquid in recent years.

For the full FCA statement and the report, please click here.

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