meta_id 3006818

The European Securities and Markets Authority (ESMA) has published guidelines on stress test scenarios under the Money Market Fund (MMF) Regulation. The guidelines, referenced as ESMA50-481369926-30848, provide fund managers with standardised stress testing methodologies and scenarios to assess the resilience of money market funds under adverse market conditions. The guidelines establish a framework for conducting stress tests that money market fund managers must perform to evaluate portfolio performance under various stress scenarios. These stress tests are designed to ensure that fund managers can identify potential vulnerabilities in their portfolios and implement appropriate risk mitigation strategies. The guidelines specify the types of scenarios to be tested, including interest rate shocks, credit spread widening, liquidity stress events, and other market disruptions relevant to money market fund operations. By providing harmonised stress test scenarios across the European Union, ESMA aims to ensure consistent application of the MMF Regulation and enhance the stability of the money market fund sector. The guidelines apply to all authorised money market fund managers operating within the European Union and are intended to strengthen investor protection and systemic financial stability. The guidelines have been translated into all official European Union languages, including Bulgarian, Croatian, Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Italian, Latvian, Lithuanian, Maltese, Polish, Portuguese, Romanian, Slovak, Slovenian, and Swedish, to ensure accessibility across all member states. REFERENCES: ESMA50-481369926-30848 Guidelines on stress test scenarios under the MMF Regulation