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End of an Era of Risk Management Suppression - CME Group
The appetite for risk management is likely to grow strongly in the coming years. Of the many factors that influence the appetite for risk management, the one primary factor that has undergone a major change is the shift in the Federal Reserve (Fed) and European Central Bank’s policy focus during 2022 and 2023 towards fighting inflation and potentially keeping short-term interest rates above prevailing expectations for inflation for sustained periods of time, except possibly during serious recessions. This policy shift reversed a decade or more of the zero-interest-rate policy (ZIRP) that created incentives for ... (full story)