After two years of strong decline in sales volumes, the lingering long-term impact of the Covid crisis may turn out to be a good thing for market-linked certificates of deposit (MLCDs).

Issuance and sales volumes of MLCDs in the US has dropped dramatically in 2020. We take a look at how the market for CDs has evolved in the past five years, whether the decline is permanent, and what needs to happen before there is a reversal of the current trend. The main driver behind the slump has, and continues to be, the interest rate environment. In order to be classified as a CD, there cannot be any potential loss of principal - this sometimes makes MLCD features less attractive than fe

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