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Cash & liquidity solutions

Cash & liquidity solutions

In a landscape marked by continued macroeconomic and geopolitical challenges, we’re looking to offer insights into how treasurers can optimise their cash strategies for the months ahead. In addition, our monthly Central Bank update provides an at-a-glance view of recent central bank moves.

Addressing your liquidity needs
Which Insight liquidity solution is right for you?

Currently, market data indicates that German corporate treasurers in aggregate earn around 0.68%¹ on their cash deposits. We believe keeping excess cash in a bank account can limit the opportunity to benefit from market based yields. By reallocating some liquidity to a short term, liquid money market fund, treasurers can potentially improve their interest income while retaining daily liquidity. For instance, with an average deposit of €100m, shifting 70% to a money market fund could, for illustrative purposes, result in a material difference in annual interest - such as up to €980k. This may be a useful time to review your cash strategy.

We have strategies available to meet your liquidity management needs (click on the left and right buttons below for details).

Key indicators
Europe

Looking ahead

After holding rates steady in 2025, markets are projecting the ECB will follow suit in 2026. In the US, the Fed has resumed easing, with further cuts anticipated into 2026, possibly bringing rates down to 3.25%–3.5%. Meanwhile, the Bank of England is expected to deliver one final cut this cycle, constrained by persistent inflation.

Figure 1: ECB deposit facility rate

Figure 1 ECB deposit facility rate V2.png


Source: European Central Bank, data as at 31 December 2025

Eurozone inflation remains anchored at 2%, with a modest decline expected next year due to base effects. Tariff-related price pressures may be tempered by weak consumer demand and cheaper Chinese imports.

 

Figure 2: Market pricing of rate cut probability

Figure 2 Market pricing of rate cut probability.png
Source: Insight and Bloomberg, data as at 31 December 2025.
How to get in touch
You can contact me by:

Email: julie.oconnor@insightinvestment.com

Tel: +353 1 584 6255

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