Banks pull back from market-making
Banks' reticence to get involved in market-making, evident since last September, is leading to widespread concerns over liquidity in the energy markets, say experts.
"There has been a huge structural pullback in market making," says Vincent Kaminski, a professor at Rice University.
"Many traders are worrying about marking to market their positions in a market that is becoming less and less transparent for transactions with longer tenors," he says. "Participants that are still active in these
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