The Committee of European Securities Regulators' (CESR) recent consultation on proposals for pan-European definitions of money market funds (MMFs) paves the way towards a convergence of pan-European standards, Fitch Ratings said.

"Fitch notes the movement towards a global convergence in standards for short-term money-market funds based on proposals from regulators globally on funds' interest rate and spread risk exposures," said Charlotte Quiniou, director in Fitch's fund and asset manager rating team. "However, there is less consensus on acceptable spread risk limits for longer-term MMFs. CESR's proposals would position European longer-term MMFs relatively conservatively with regard to proposed limits on portfolio weighted average life and instrument maturity."

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