House Panel Backs Bill to Scrap Floating Prices for Money Funds
- Post-crisis rule raised municipal borrowing costs, critics say
- Key industry group opposes change, says markets have adjusted
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The House Financial Services Committee has advanced a bill that would eliminate some of the strictures placed on the $2.8 trillion money market mutual fund industry in the wake of the financial crisis.
The legislation, which was opposed by Fidelity Investments, Vanguard Group., BlackRock Inc. and other major asset managers, would repeal a 2014 requirement that the riskiest funds allow their share prices to float, rather than maintain a stable $1 value. The panel’s action clears the way for a House vote on the measure.