...Negative Yields General Across Euro MMFs: The vast majority of euro MMFs are now delivering negative yields (minus 8bp on average at mid-July), as market rates have continued to decline. Now that the move into negative territory is widespread across euro funds, the net yield decline has accelerated due to fees normalisation after months of waivers. Sterling and US dollar-denominated MMFs have continued, in contrast, to see modest yield uptick. Declining CNAV Assets: European constant net asset value (CNAV) funds' assets declined by 8% to EUR536bn in 2Q15, primarily affecting euro and sterling funds, after they had reached an historical peak at end-March. French VNAV funds, the second largest segment of European MMFs, stabilised at EUR310bn at end-June, with notable intra-quarter volatility. SSA Exposure Reaches New Highs: Sovereign, supranational and agency (SSA) of high credit quality and liquidity are an attractive sector for MMFs, which seized the opportunity of slightly higher yields...
