SSA euro CP outstandings tank as S&P warns money markets
SSAs in the European Union have slashed their outstanding volumes of commercial paper and certificates of deposit in euros by over 15% since the European Central Bank cut its deposit rate by 10bp to minus 0.1% on June 5. The figures come as Standard & Poor’s warned that the rate cut could cause investors to pull out of money market funds — one of the ECP market’s most important investor bases.
S&P predicted on Monday that some investors are likely to withdraw cash from euro denominated money funds in search of better returns elsewhere — potentially reducing demand for short term euro debt.
“It is only a matter of time before euro denominated money market funds feel the impact,” ...Already a subscriber? Login