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Investment Priorities Through a Regulatory and Market Transition

 

by Jason Straker, Head of Client Portfolio Management, Global Liquidity EMEA, J.P. Morgan Asset Management

Every year, J.P. Morgan Asset Management (JPMAM) produces its Global Liquidity Investment PeerView report, an in-depth study based on an extensive survey of more than 400 liquidity investors globally. The report illustrates trends and behaviours amongst investors, and provides a valuable benchmark for investors to consider how they are managing liquidity and identify potential areas of focus. In this article, Jason Straker, Head of Client Portfolio Management, EMEA for J.P. Morgan Asset Management’s Global Liquidity Group discusses some of the key findings and the action points for treasurers.

A market in transition

2015 is a particularly interesting year in which to conduct the PeerView survey, given that significant regulatory developments are under way, combined with a challenging, but potentially changing interest rate environment. Banks in North America and Europe in particular are implementing Basel III, one of the outcomes of which is a declining appetite for non-operating deposits of less than three months’ duration. At the same time, money market fund (MMF) reforms have been finalised in the United States, and will take effect over the coming months. These reforms are forming a backdrop to discussions in Europe and other regions such as China on similar reforms. From an interest rate perspective, negative interest rates in Europe create specific challenges for euro investors, while investors in USD and to an extent GBP are anticipating an increase in rates.

2015 is a particularly interesting year in which to conduct the PeerView survey