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ETF turnover fell by 13.6 per cent for the week ending 19 August over the previous week, with total monthly average daily turnover of just €870m (£687.8m), while European fixed income ETF turnover fell by 3 per cent to €171m.

However, Nizam Hamid, managing director at db Research, said: "A daily total of €1bn is quite a good figure for August, a relatively quiet month in Europe.

"I would expect to see a bounce in volumes in September, with an increase over the long term.

"A lot of trades have been driven by market volatility, with investors shifting into short or leveraged ETFs, as they cannot use conventional derivatives."

Lipper is also upbeat about the prospects for the pan-European ETF sector, despite rough market conditions.

The latest Lipper Fundmarket Insight Report showed assets under management rose month-on-month 3.23 per cent to €100.89bn in June - the €100bn barrier being breached for the first time in the second quarter.

The report said equities, the largest asset class, showed the lowest relative growth between 31 March and 30 June.

The monthly average turnover in euros was down 27.27 per cent, from €32.74bn in the first quarter to €23.81bn in the second quarter, after an all-time high in the first quarter of 2008.

Compared with the second quarter of 2007, the average was up 21.45 per cent, showing the ETF segment is still growing at a fast pace.

Detlef Glow, head of central, north and eastern European research at Lipper and author of the report, said: "Recent market volatility has not affected the ETF market, and we will get back to a growth pattern over the next few months."