The RMB International Income Fund's asset allocation remains approximately 1/3 each in the Euro, GBP and USD. As was the case in all the money funds, cash balances have been shifted to money market instruments this quarter.

Good news for the fund is the continued hawkish stance of the ECH, and possibly even the Bank of England. Short-term rates are on the up, meaning higher income for the fund over the next number of quarters.

Over the last quarter, global money markets have had to contend with a rising interest rate environment. The Federal Reserve in the US has increased rates 3 times to 5.25%, the European Central Bank twice to 2.75%, and there is speculation that the Bank of Japan will raise interest rates for the first time since 2001.

Going forward, opinion is divided over the future path of US interest rates. Some commentators believing that the Fed is only one more 25bps hike away from the top of the interest rate cycle. Whereas others believe there could be another two or even three further hikes to come. Of course, future hikes are good news for investors in money market funds.