Rating agency Moody's has cut the ratings of three bond funds run by JPMorgan. The three are the US Dollar, Euro and Sterling Enhanced Yield funds.

The credit risk rating of the first was downgraded for its exposure to a defaulted security. The market risk ratings of all three have been downgraded because of declining valuations in the asset-backed sector, increasing shareholder concentration and substantial outflows.

The funds' objective is to provide high current income consistent with the preservation of capital and a high degree of liquidity. Although the funds aim to minimise exposure to risk or loss of capital, they are not managed with the aim of maintaining a stable net asset value and thus not considered to be constant net asset value money market funds.