New York Federal Reserve President William Dudley said on Friday that more needs to be done to reduce risks in collateralized short-term funding markets, but made no reference to the U.S. economy or monetary policy in his prepared remarks.

Speaking at the start of a New York Fed conference on "'Fire Sales' as a Driver of Systemic Risk in Tri-Party Repo and Other Secured Funding Markets," Dudley said regulators will have to step up to address risks if the industry cannot do so.

In a paper earlier this year, Fed researchers said regulators had "limited" tools to stop investors from rapidly selling assets should a dealer default.

The overnight repurchase, or repo, market, where investors borrow short-term cash using securities as collateral, came under severe stress after Lehman Brothers failed in 2008 and investors liquidated holdings. That prompted the Fed to launch emergency lending facilities.