The Federal Reserve released its latest quarterly "Z.1 Financial Accounts of the United States" statistical survey (a.k.a. "Flow of Funds") late last week, and among the 4 tables it includes on money market mutual funds, the Second Quarter 2025 edition shows that Total MMF Assets increased by $83 billion to $7.481 trillion in Q2'25. The Household Sector, by far the largest investor segment with $4.877 trillion, saw the biggest asset increase in Q2, followed by Property-Casualty Insurance. The Fed's latest Z.1 numbers, which contain one of the few looks at money fund investor segments available, also showed noticeable increases for the Mutual Funds and Nonfinancial Corporate Business categories in Q2 2025. (Note: For those attending our upcoming European Money Fund Symposium, Sept. 22-23, 2025 in Dublin, Ireland, safe travels and we look forward to seeing you next week!)
Mutual funds, Nonfinancial Corporate Business, Life Insurance Companies, Exchange-traded funds, Rest of World, State & Local Governments, State & Local Govt Retirement and Nonfinancial Noncorporate Business categories saw small asset increases in Q2, while the Other Financial Business (formerly Funding Corps) category saw the only asset decrease last quarter. Over the past 12 months, the Household Sector, Nonfinancial Corporate Business, Other Financial Business and Property-Casualty Insurance categories showed the biggest asset increases, while State & Local Govt Retirement saw the only asset decrease.
The Fed's "Table L.206," "Money Market Mutual Fund Shares," shows that total assets increased by $83 billion, or 1.1%, in the second quarter to $7.481 trillion. The largest segment, the Household sector, totals $4.877 trillion, or 65.2% of assets. The Household Sector increased by $56 billion, or 1.2%, in the quarter. Over the past 12 months through June 30, 2025, Household assets were up $682 billion, or 16.3%.
Nonfinancial Corporate Businesses, the second-largest segment according to the Fed's data series, held $987 billion, or 13.2% of the total. Assets here increased by $7 billion in the quarter, or 0.7%, and they've increased by $108 billion, or 12.3%, over the past year. Other Financial Business was the third-largest investor segment with $496 billion, or 6.6% of money fund shares. This category fell $28 billion, or -5.3%, in the latest quarter. Other Financial Business, which we believe includes Securities Lending, has increased by $54 billion, or 12.3%, over the previous 12 months.
The Mutual Funds (a recent addition to the tables), moved up to fourth place in market share among investor segments with 3.0%, or $225 billion, The fifth-largest segment, Rest of World held $220 billion (2.9%). Private Pension Funds was the 6th largest category with 2.7% of money fund assets ($202 billion); it was down $100 million for the quarter and down $300 million, or -0.1% over the last 12 months. while Nonfinancial Noncorporate Business held $144 billion (1.9%), Life Insurance Companies held $105 billion (1.4%), State & Local Governments held $84 billion (1.1%), Property-Casualty Insurance held $79 billion (1.1%), Exchange-traded Funds held $41 billion (0.6%), and State & Local Govt Retirement held $22 billion (0.3%) according to the Fed's Z.1 breakout.
The Fed's "Flow of Funds" Table L.121 shows "Money Market Mutual Funds" largely invested in “Security Repurchase Agreements” with $3.105 trillion, or 41.5%, and "Debt Securities," or Credit Market Instruments, with $4.069 trillion, or 54.4% of the total. Debt securities include: Open market paper ($313 billion, or 4.2%; we assume this is CP), Treasury securities ($2.614 trillion, or 34.9%), Agency and GSE-backed securities ($993 billion, or 13.3%), Municipal securities ($141 billion, or 1.9%) and Corporate and foreign bonds ($9 billion, or 0.1%).
Another large MMF position in the Fed's series includes `Time and savings deposits ($303 billion, or 4.1%). Money funds also hold minor positions in Miscellaneous assets ($2 billion, or 0.0%) and Foreign deposits ($1 billion, 0.0%). Note: The Fed also lists "Variable Annuity Money Funds," which currently total $51 billion.
During Q2, Debt Securities were down $183 billion. This subtotal included: Open Market Paper (down $11 billion), Treasury Securities (down $267 billion), Agency- and GSE-backed Securities (up $90 billion), Corporate & Foreign Bonds (up $1 billion) and Municipal Securities (up $2 billion). In the second quarter of 2025, Security Repurchase Agreements were up $284 billion, Foreign Deposits were down $300 million, Time & Savings Deposits were down $17 billion, and Miscellaneous Assets were down $1 billion.
Over the 12 months through 6/30/25, Debt Securities were up $458 billion, which included Open Market Paper (up $31B), Treasury Securities (up $164.), Agencies (up $252B), Municipal Securities (up $9B), and Corporate and Foreign Bonds (up $3B). Foreign Deposits fell $4B and Time and Savings Deposits decreased $1B. Securities Repurchase Agreements were up $490B over the year, while Miscellaneous Assets fell $10B.
The L.121 table shows `Stable NAV money market funds with $7,136 billion, or 95.4% of the total (up $82.1B or 1.2% in Q2 and up $1.012 trillion or 16.5% over 1-year), and Floating NAV money market funds with $345 billion, or 4.6% (up $1.3B or 0.4% in Q2 and down $79B or -18.6% over 1-year). Government money market funds total $6.056 trillion, or 80.9% (up $55.6B or 0.9% in Q2 and up $829B or 15.9% over 1-year), `Prime money market funds total $1.283 trillion, or 17.1% (up $27.0B or 2.1% in Q2 and up $95B or 8.0% over 1-year) and Tax-exempt money market funds $143B, or 1.9% (up $0.8B or 0.6% in Q2 and up $9B or 6.8% last year).
Note that the Federal Reserve made some changes to its Z.1 tables several years ago. Describing a "Money market funds sector data source change," the report says, "The money market mutual funds (MMF) sector (tables F.121 and L.121) has been revised beginning 2010:Q4 to reflect a change in data source to Securities and Exchange Commission Form NMFP. The level of assets and shares outstanding of the sector have increased due to the inclusion of private placement MMFs in the source data. Changes in the level due to changes in the data source in 2010:Q4 are recorded as other volume changes in the Financial Accounts."
On "Mutual funds sector holdings of money market funds," Z.1 tells us, "The mutual funds sector (tables F.122 and L.122) has been revised beginning 2010:Q4 to reflect holdings of money market funds not previously reported on the tables. In addition, holdings of repurchase agreements, commercial paper, corporate bonds, and miscellaneous assets have been revised. Additional and revised holdings are estimated using data from Morningstar and Investment Company Institute.... The exchange-traded funds sector (tables F.124 and L.124) has been revised beginning 2010:Q4 to reflect holdings of money market funds not previously reported on the tables."
