2025 Market Outlook: Key January Events to Watch 
U.S. Treasury Yields Expected to Decline Amid Cooling Economic Pressures 
US Gas Market Poised for Supercycle: Bernstein Analysts 
Wall Street Analysts Weigh in on Latest NFP Data 
Goldman Predicts 50% Odds of 10% U.S. Tariff on Copper by Q1 Close 
Stock Futures Dip as Investors Await Key Payrolls Data 
European Stocks Rally on Chinese Growth and Mining Merger Speculation 
Moody's Upgrades Argentina's Credit Rating Amid Economic Reforms 
S&P 500 Relies on Tech for Growth in Q4 2024, Says Barclays 
China's Refining Industry Faces Major Shakeup Amid Challenges 
Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
Fed May Resume Rate Hikes: BofA Analysts Outline Key Scenarios 
UBS Projects Mixed Market Outlook for 2025 Amid Trump Policy Uncertainty 
Geopolitical Shocks That Could Reshape Financial Markets in 2025 
China’s Growth Faces Structural Challenges Amid Doubts Over Data 
Trump’s "Shock and Awe" Agenda: Executive Orders from Day One 
US Futures Rise as Investors Eye Earnings, Inflation Data, and Wildfire Impacts 
European policy makers have proposed money market fund (MMF) reforms relatively similar to the US changes slated to take effect next year, says Moody's Investors Service in a new report published today.
"As in the US, the goal in Europe is to enhance MMFs' ability to withstand stressed market conditions, reducing systemic risk. However, reforms will have diverging effects in these markets, given their very different starting points," observes Vanessa Robert, a Moody's Vice President -- Senior Credit Officer.
"For investors, the new money fund regulations will generally translate to more conservative portfolios, because portfolio managers will want to limit net asset value volatility. Investors can expect more transparency around fund valuation from portfolio managers, but also lower yields" says Marina Cremonese, a Moody's analyst. Moody's also expects a proliferation of MMF types, especially in Europe, which could confuse investors.
In the US, Moody's expects government and treasury funds to represent a bigger slice of US MMF assets. Prime MMFs will shrink in size and primarily appeal to retail investors, who can continue to invest in constant net asset value (CNAV) structures. Institutional investors will only find prime MMFs attractive if the yield differential with government MMFs is high enough to compensate for the risk of fees and gates.
The rating agency forecasts that MMF assets both in the US and in Europe will remain fairly stable, despite a reallocation of assets within the different types of MMFs. The US government and treasury MMF segment could grow by as much as 25% in assets. In Europe, Moody's considers that low volatility net asset value (LVNAV) funds have the potential to widely replace prime CNAV MMFs, which currently account for about 60% of the MMF sector.
At the asset manager level, Moody's expects the industry to remain concentrated with potential for further, although limited, consolidation both in Europe and in the US. These regulations favour the bigger players who are able to leverage their scale to more easily stomach increasing costs and are in a better position to offer a variety of cash and short term investment solutions to investors.
