Fidelity Investments' latest "Money Markets" update, entitled, "The Fed Stays On Its Fairly Hawkish Path," tells us, "Fidelity's money market funds are well-positioned for higher rates. We believe policy interest rates will continue to trend higher. The September FOMC meeting largely confirmed the Fed's expectations for three more rate hikes in 2018, in addition to the quarter-point hike expected at yearend 2017. This likely will continue the trend of higher rates that began 21 months ago. While the Fed slightly reduced its long-run rate outlook at its September meeting, removing nearly one full quarter-point rate hike from its long-term projection, this slightly dimmer view may not matter very much, given the number of Fed board governors set to be replaced in the coming months. The steady increase in market rates is driving liquidity into both money market and ultrashort bond funds. While government money market funds have yet to return to their prior peak after a sluggish first half, prime money market funds have grown by $66 billion year-to-date and may continue to benefit as corporate treasurers further segment liquidity. Any tax repatriation may also benefit the funds, as treasurers seek enhanced diversification and relatively higher rates versus bank-administered deposits.... Fidelity's money market funds are positioned with short weighted-average maturities. Thus, we believe the funds are well-positioned in a market that has exhibited higher yields and fairly stable spreads ... and are prepared for higher rates."

Email This Article




Use a comma or a semicolon to separate

captcha image

Daily Link Archive

2024 2023 2022
March December December
February November November
January October October
September September
August August
July July
June June
May May
April April
March March
February February
January January
2021 2020 2019
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2018 2017 2016
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2015 2014 2013
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2012 2011 2010
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2009 2008 2007
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2006
December
November
October
September