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Liquidity Lens: Q3 2026

Liquidity Lens

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.

Are you maximising the return on your cash holdings?

Compare the return on your current cash holdings with the indicative yield of an Insight Liquidity Fund and see the potential earnings difference based on the assumptions used in this calculator.

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Important Information: This calculator is provided for illustrative purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any investment. The figures and results generated are hypothetical and are based on assumptions, including the information entered by the user and illustrative yield and earnings differentials. Actual outcomes may differ and may be affected by factors including fees, taxes, investor-specific circumstances and currency movements. The calculator is designed to illustrate the potential difference in earnings between a cash balance and selected Insight liquidity funds over a one-year period. The figures shown are illustrative only and should not be relied upon as a forecast, projection or guarantee of future performance or returns. Illustrative earnings are calculated by applying the illustrative yield differential to the cash balance entered over a one-year period and do not reflect compounding, reinvestment of income or changes in yields during the period. Illustrative yields and earnings shown are indicative, may change and are not guaranteed. Past or current yields are not a reliable indicator of future returns. Illustrative earnings are hypothetical, based on the assumptions used in the calculator, and should not be relied upon as a forecast or guarantee of future outcomes. Unless otherwise stated, the yields used in the calculations are shown gross of applicable fees and expenses. The calculator is based on selected Insight LVNAV liquidity funds in GBP, EUR and USD. These funds have been chosen because they are designed as short-term money market funds with a focus on liquidity and capital preservation. Other Insight liquidity products, including VNAV funds, have not been included in the analysis. Different fund selections may produce different results. Before making any investment decision, investors should consider the relevant fund documentation and seek independent professional advice where appropriate.

Our latest thinking on money market funds

Key indicators - Q3 2026
Europe

Looking ahead

In the eurozone, we believe economic growth is likely to remain subdued, particularly relative to the US, with GDP expected to remain below 1% in 2026 before improving modestly in 2027. Consumer confidence remains fragile amid ongoing geopolitical uncertainty, while elevated savings rates continue to weigh on demand. However, the labour market has remained resilient and Germany’s planned fiscal expansion should provide some support, despite the broader growth outlook remaining weak. We expect GDP to expand by 0.9% in 2026, with an improvement to 1.0% in 2027.

Figure 1: ECB deposit facility rate

Source: European Central Bank, data as at 30 September 2026

We expect the ECB to raise rates once more before pausing as inflation gradually returns towards target, with policy easing thereafter as price pressures continue to moderate. We see 10-year German government bond yields ending the next 12 months slightly above current levels at around 3.1%, with the curve steepening as shorter-dated yields decline once it becomes clearer that policy rates have peaked. Fiscal concerns, particularly in France, may also contribute to periods of volatility in sovereign bond markets.

 

Figure 2: Market pricing of rate cut probability


Source: Insight and Bloomberg, data as at 30 September 2026.
How to get in touch
You can contact me by:

Email: julie.oconnor@insightinvestment.com

Tel: +353 1 584 6255

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