• Home
  • About
  • Newsletters
  • Conference
  • TMS Links
  • Calendar
  • Log In
  • Register

Room 151

  • 151 BRIEF

    What's New?

  • Glasgow raises £195m in debt finance deal

    December 5, 2019

  • Bexley housing company scales back housing target

    December 5, 2019

  • Redbridge approves lottery plans

    December 5, 2019

  • Halton imposes freeze on non-essential spending

    December 5, 2019

  • FRC looks to increase control over auditors

    December 5, 2019

  • Legal & General invests £100m in Sunderland regeneration project

    November 28, 2019

  • Treasury
  • Technical
  • Funding
  • Resources
  • LGPS
  • Development
  • 151 News
  • Blogs
    • David Green
    • Agent 151
    • Dan Bates
    • Richard Harbord
    • Stephen Sheen
    • James Bevan
    • Steve Bishop
    • Cllr John Clancy
    • David Crum
    • Graham Liddell
    • Ian O’Donnell
    • Jackie Shute
  • Interviews
  • Jobs

Cash managers report steady MMF demand

0
  • by Jim Dunton
  • in 151 News · Treasury
  • — 14 Nov, 2019
Global survey by J.P. Morgan. Image by PIRO4D from Pixabay

An annual survey of cash managers has reported that demand for money market funds (MMFs) remains steady against a backdrop of global uncertainty that names Brexit as one of the two biggest risks.

J.P. Morgan Asset Management’s 2019 Global Liquidity PeerView Survey, found MMFs remained the most permissible investment identified in the policies of 346 managers who took part – more than one-third of whom are based in Europe.

SAVE THE DATE – LATIF NORTH
March 25th, 2020, Manchester
Council treasury investment & borrowing

The survey found 92% of investment policies detailed MMFs, followed by bank obligations at 62% and US Treasury bonds a nose behind at 60%.

According to recent MHCLG figures, UK local authorities currently hold around £9.1bn of investments in money market funds, accounting for roughly 21% of all local government treasury investments.

J.P. Morgan said that precisely three-quarters of cash managers said they had no intention of changing their stable net asset value MMFs for the coming year, based on the current outlook.

However, more than two-thirds (67%) identified the combination of rising US-China trade tensions and Brexit uncertainty as investment challenges for the coming 12 months.

Paula Stibbe, global head of liquidity sales at J.P. Morgan Asset Management, said slowing growth and declining interest-rate returns could be added to those risks.

“The changing global economic environment presents investors with many new challenges,” she said.

 “This year’s PeerView results suggest that in this environment, demand for money market funds remains strong, and investors with short-term fixed income portfolios are increasingly looking at areas such as ESG screening and treasury management systems when evaluating their cash investment strategy.”

The survey found 19% of investors using ESG – environmental, social and governance – criteria  to screen investments, with a further 25% describing themselves as “likely” to start before 2022.

It also flagged the increasing adoption of treasury management systems, with 61% of respondents describing themselves as users. J.P. Morgan said survey respondents in Europe and the Middle East Area were the least likely to develop in-house treasury management systems (11%) and Asia Pacific respondents the most (43%).

Breaking down the responses for key regional concerns, the survey found avoiding negative interest rates in euro and sterling investments was a focus area for managers in Europe, with 39% of managers identifying it as a problem area.

It said term deposits were the most popular solution, identified by 62% of managers. Ultra-short duration bond funds were the second-placed choice (23%).

In the Asia Pacific region, fears over the escalation potential for the US-China trade war were added to by anxiety over the outlook for rising credit and default risk by China, cited by 22% of respondents, and the impact of regulatory reform.

A region-by-region breakdown of J.P. Morgan Asset Management’s survey showed 153 responses came from the Americas, 116 from Europe and 77 from Asia Pacific nations.

The Room151 Weekly Newsletter covers local government treasury and pension investment, funding, development, resources and technical finance. Register here. 

The LGPS Quarterly Briefing focuses purely on pension fund investment. Register here.

Share

You may also like...

  • David Green: Top Five bond considerations 3 Dec, 2015
  • Border to Coast launches sub-funds with assets worth £7bn 2 Aug, 2018
  • Javid sends inspectors in to Northamptonshire 11 Jan, 2018
  • New regs ‘push’ ESG on to pension trustees’ agenda 21 Jun, 2018

Leave a Reply Cancel reply

You must be logged in to post a comment.

  • Register to become a Room151 user

  • Latest tweets

    Room 151 18 hours ago

    LGPS urged to put the ‘social’ back into ESG: LGPS committee members and managers have been asked to elevate the importance of the “S” in ESG (environmental, social and governance) to help protect workers’ rights as the world confronts[...] dlvr.it/RL1c9p pic.twitter.com/xv590d3qm8

    Room 151 1 day ago

    Room 151’s top 10 news stories of 2019 room151.co.uk/treasury/room-… #localgov

    Room 151 2 days ago

    Room 151’s top news stories of 2019: As an eventful year for local authority treasurers draws to a close, Room 151 takes a look at the top 10 stories from the sector during 2019. 10. Spending watchdog[...] dlvr.it/RKy49q

    Room 151 6 days ago

    Council files £130m claim against PFI contractor for post-Grenfell estate costs: London Borough of Camden is suing a former PFI partner and its main subcontractors for £130m for costs relating to the evacuation of one of its housing estates the week[...] dlvr.it/RKkR8C pic.twitter.com/zIfQcikMjq

    Room 151 6 days ago

    Review highlights ongoing financial management issues at Northamptonshire: Northamptonshire County Council’s new section 151 officer should draw up plans to repatriate powers from government commissioners amid ongoing problems with financial management,… dlvr.it/RKjLkN pic.twitter.com/tQIxMDawQV

    Room 151 7 days ago

    Doug McMurdo: LGPS, the Stewardship Code, good governance and protecting capital: I have spent the last decade leading Bedfordshire Pension Fund (BPF) as chairman of the pensions committee. We are facing many challenges, not least the reforms that the… dlvr.it/RKfJrD

    Room 151 7 days ago

    Active managers still in the game: Under performance and high costs have given active management a bad press, some of it well deserved. But it appears to be on the brink of a renaissance with some[...] dlvr.it/RKfJjR pic.twitter.com/yyAcm1wSMy

    Room 151 1 week ago

    Court ruling leaves councils facing compensation bills for water overcharging: Councils could face compensation costs running into the millions after the High Court ruled that a council unlawfully overcharged its tenants for supplying water from 2002,… dlvr.it/RKZnQK pic.twitter.com/tawdmA9wlE

    Room 151 1 week ago

    Election 2019: “Stark” differences in parties’ proposals for council funding: Conservative Party manifesto proposals would not meet rising costs faced by councils, while Labour Party policies would meet demand even with a council tax freeze, according to… dlvr.it/RKZnNT pic.twitter.com/F16kSfQrXI

    Room 151 1 week ago

    LGPS women discuss: climate & pension fund investing: Climate change has become one of the biggest issues for asset owners and managers as they move to tackle global warming. Room151 convened a roundtable of LGPS practitioners and advisers[...] dlvr.it/RKXsWW pic.twitter.com/3rtUTapwkF

  • Categories

    • 151 News
    • Agent 151
    • Blogs
    • Chris Buss
    • Cllr John Clancy
    • Dan Bates
    • David Crum
    • David Green
    • Development
    • Forum
    • Funding
    • Graham Liddell
    • Ian O'Donnell
    • Interviews
    • Jackie Shute
    • James Bevan
    • Jobs
    • LGPSi
    • Mark Finnegan
    • Recent Posts
    • Resources
    • Richard Harbord
    • Stephen Fitzgerald
    • Stephen Sheen
    • Steve Bishop
    • Technical
    • Treasury
    • Uncategorized
  • Archives

    • 2019
    • 2018
    • 2017
    • 2016
    • 2015
    • 2014
    • 2013
    • 2012
    • 2011
  • Previous story Brunel launches emerging markets sub-fund
  • Next story Guidance recommends sale of risky investment properties

© Copyright 2019 Room 151. Typegrid Theme by WPBandit.

We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we'll assume that you are happy to receive all cookies from this website.OK