Fundsters and other asset managers are worried about rising interest rates, and they're telling the Fed.
The just-released minutes
of last month's Investor Advisory Committee on Financial Markets, which includes Mary Callahan-Erdoes
of J.P. Morgan Asset Management
] and Rick Rieder
], reveal that the asset managers on the committee told New York Federal Reserve President William Dudley
that, if interest rates start to rise, retail bond fund investors will take a beating.
"Uncertainty was expressed as to the potential market functioning impacts of large outflows from corporate credit-related mutual funds and ETFs, especially as retail holdings of corporate bonds have increased relative to market volumes and broker-dealer balances have decreased," the minutes read.
Jennifer Ablan and Jonathan Spicer of Reuters covered
the meeting minutes.
Neil Anderson, Managing Editor
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