Money Market News
Crane Data's latest monthly Money Fund Portfolio Holdings statistics will be sent out Wednesday, and we'll be writing our regular monthly update on the new August 31 data for Thursday's News. But we also already uploaded a separate and broader Portfolio Holdings data set based on the SEC's Form N-MFP filings on Tuesday. (We continue to merge the two series, and the N-MFP version is now available via our Portfolio Holdings file listings to Money Fund Wisdom subscribers.) Our new N-MFP summary, with data as of August 31, includes holdings information from 1,020 money funds (up 20 from last month), representing assets of $6.644 trillion (up from $6.602 trillion). Prime MMFs fell down to $1.129 trillion (down $24.0 billion), or 17.0% of the total. We review the new N-MFP data, and we also look at our revised MMF expense data, which shows charged expenses were mostly the same and money fund revenues slightly rose to $17.6 billion (annualized) in August. (Note: We're still adjusting to the SEC's new Form N-MFP format, so there continue to be some distortions in our data. Let us know if you see any issues or have any questions!)
Crane Data's latest monthly Money Fund Market Share rankings show assets increasing among most of the largest U.S. money fund complexes in August, after rising in July, June and May, but falling in March and April. Money market fund assets rose by $105.6 billion, or 1.6%, last month to a record $6.619 trillion. Total MMF assets have increased by $144.2 billion, or 2.2%, over the past 3 months, and they've increased by $602.0 billion, or 10.0%, over the past 12 months. The largest increases among the 25 largest managers last month were seen by BlackRock, Fidelity, Schwab, JPMorgan and Allspring, which grew assets by $33.4 billion, $32.8B, $10.4B, $10.3B and $10.3B, respectively. Declines in August were seen by American Funds, Invesco, Northern, PGIM and T Rowe Price, which decreased by $12.6 billion, $8.1B, $6.0B, $1.8B and $1.3B, respectively. Our domestic U.S. "Family" rankings are available in our MFI XLS product, our global rankings are available in our MFI International product. The combined "Family & Global Rankings" are available to Money Fund Wisdom subscribers. We review the latest market share totals, and look at money fund yields, which were slightly lower in August.
The September issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Monday morning, features the articles: "SSGA, Columbia Stick with Prime Inst MMFs; Changes," which breaks down the latest news in the Prime Inst space; "MMFs Hit Record $6.68 Trillion; Falling Rates Driving Inflows," which covers the recent (and pending) asset surge; and, "More Scrutiny on Sweeps; Investment News, UBS," which follows the most recent news on brokerage sweeps. We also sent out our MFI XLS spreadsheet Monday a.m., and we've updated our Money Fund Wisdom database with 8/31/24 data. Our Sept. Money Fund Portfolio Holdings are scheduled to ship on Wednesday, September 11, and our Sept. Bond Fund Intelligence is scheduled to go out on Monday, September 16. (Note: We're still taking registrations for our upcoming European Money Fund Symposium, which will be held Sept. 19-20, 2024 in London, England. See you in London next week!)
The Investment Company Institute published its latest weekly "Money Market Fund Assets" report Thursday. ICI shows money market mutual fund assets jumping for the fifth week in a row (up $37.3 billion) to a record $6.300 trillion. Assets have risen in 16 of the last 20 weeks, increasing by $322.7 billion (or 5.4%) since April 24. MMF assets are up by $414 billion, or 8.7%, year-to-date in 2024 (through 9/4/24), with Institutional MMFs up $150 billion, or 4.9% and Retail MMFs up $264 billion, or 15.7%. Over the past 52 weeks, money funds have risen by $675 billion, or 12.0%, with Retail MMFs up by $448 billion (21.3%) and Inst MMFs rising by $227 billion (6.5%). (Note: Crane Data's separate and more comprehensive asset series shows money funds hitting a record $6.648 trillion this week!)
The SEC published its latest quarterly "Private Funds Statistics" report recently, which summarizes Form PF reporting and includes some data on "Liquidity Funds," or pools which are similar to but not money market funds. The publication shows overall Liquidity fund assets were higher in the latest reported quarter (Q4'23) at $352 billion (up from $346 billion in Q3'23 and up from $318 billion in Q4'22). We also again briefly review the part of the SEC's MMF Reforms which addresses "Amendments to Form PF Reporting Requirements for Large Liquidity Fund Advisers" and which went into effect over the summer, below. (Note: Register ASAP for our upcoming European Money Fund Symposium, which will be held Sept. 19-20, 2024 in London, England. See you in London in 2 weeks!)
Federated Hermes' latest monthly commentary from Money Market CIO Deborah Cunningham is titled, "Here we go again." She explains, "It should be no surprise when the financial markets get ahead of themselves. And we don't need to be an expert at behavioral economics to know rational investors don't exist. But that doesn't make it any less frustrating when traders get over their skis, adding volatility and detracting from liquidity in the market. Just as they did late last year, markets are betting the Federal Reserve cuts rates faster than policymakers have indicated and, importantly, faster than the data is supporting." (Note: Federated's Cunningham will be speaking at our upcoming European Money Fund Symposium, which will be held Sept. 19-20, 2024 in London, England. We're still taking registrations!)
The Securities and Exchange Commission published its latest monthly "Money Market Fund Statistics" summary for July, which shows that total money fund assets rose by $19.5 billion in July to a record $6.570 trillion, after jumping $21.3 billion the month prior. The SEC shows Prime MMFs decreasing $11.5 billion in July to $1.188 trillion, Govt & Treasury funds increasing $31.3 billion to $5.249 trillion and Tax Exempt funds decreasing $0.3 billion to $132.3 billion. Taxable yields mostly inched higher in July after falling in June. The SEC's Division of Investment Management summarizes monthly Form N-MFP data and includes asset totals and averages for yields, liquidity levels, WAMs, WALs, holdings, and other money market fund trends. We review their latest numbers below. (Month-to-date in August through 8/29, total money fund assets increased by $104.8 billion to $6.610 trillion, according to Crane Data's separate, and slightly smaller, MFI Daily series.)
The Investment Company Institute published its latest weekly "Money Market Fund Assets" report and its latest monthly "Trends in Mutual Fund Investing" for July 2024, as well as its monthly "Month-End Portfolio Holdings of Taxable Money Funds" Thursday. The former shows money market mutual fund assets jumping for the fourth week in a row (up $21.0 billion) to a record $6.263 trillion. Assets have risen in 15 of the last 19 weeks, increasing by $285.5 billion (or 4.8%) since April 24. MMF assets are up by $376 billion, or 8.0%, year-to-date in 2024 (through 8/28/24), with Institutional MMFs up $131 billion, or 4.3% and Retail MMFs up $245 billion, or 14.6%. Over the past 52 weeks, money funds have risen by $680 billion, or 12.2%, with Retail MMFs up by $447 billion (21.4%) and Inst MMFs rising by $232 billion (6.7%). (Note: Crane Data's separate and more comprehensive asset series shows money funds hitting a record $6.6 trillion this week!)
State Street Global Advisors (SSGA) recently confirmed that they'll be sticking with their Prime Institutional money fund offering. They published an update titled, "Money Market Reform 2024," which reviews the current round of regulatory changes impacting money market mutual funds. It explains, "During March of 2020 and the onset of the pandemic, there was broader stress in the short-term funding markets and significant redemptions of Prime Fund assets. In response, the SEC proposed additional regulations to further strengthen the Institutional Prime Fund space during periods of volatility with the goal to disincentivize any first mover advantage. In October 2024, the final wave of the SEC's money market fund reform rule changes will take effect, marking the most substantial shift since the 2016 reforms. These changes are set to redefine the landscape of Institutional Prime Money Market funds. This transition signifies a pivotal moment for the industry, reflecting the evolving regulatory environment and the drive for greater stability and transparency in the financial markets." (Note: We're still taking registrations for our European Money Fund Symposium, which will be held Sept. 19-20, 2024 in London, England. See you in 3 weeks in London!)
Bloomberg writes "'T-Bill and Chill' Is a Hard Habit for Investors to Break," which is more about money market funds and cash investing than T-bills. They tell us, "It's been the ultimate no-brainer for more than a year: Park your money in super-safe Treasury bills, earn yields of more than 5%, rinse and repeat. Or as billionaire bond investor Jeffrey Gundlach put it last October, 'T-bill and chill.' Even now, with Federal Reserve officials poised to ease benchmark interest rates from a two-decade high -- a move that would instantly push down yields on bills and other short-term debt -- money-market funds are thriving. They raked in $106 billion this month alone and their balances, at $6.24 trillion, have never been higher." (Note: Crane Data's MFI Daily asset series broke $6.6 trillion for the first time ever on Monday, August 26, hitting a record $6.608 trillion.)
While we haven't seen any more SEC filings announcing exits from the Prime Institutional money fund sector since early this month (see our Aug. 6 News, "DFA Short-Term Investment Fund Converts to Ultra-Short; FT on Flows"), we have seen a number of previously announced exits and mergers take place over the past 2 weeks. On Friday, the Prime Institutional UBS Select Prime Money Mkt Inst (SELXX, $5.196B) merged into the Prime Retail UBS Prime Reserves Fund and the Prime Inst UBS Select Prime Money Mkt Pref (SPPXX, $3.215B) merged into the Prime Retail UBS Prime Preferred Fund. Earlier in August, DWS ESG Liquidity Cap (ESIXX), DWS ESG Liquidity Inst (ESGXX) and DWS Liquidity Inst Res (ESRXX) all liquidated on 8/14/2024. Also, on 8/16, Allspring Heritage Adm (SHMXX) merged into Allspring Govt MM Adm (WGAXX), Allspring Heritage I (SHIXX) merged into Allspring Govt MM Inst (GVIXX), Allspring Heritage Sel (WFJXX) merged into Allspring Govt MM Sel (WFFXX) and Allspring Heritage Svc (WHTXX) merged into Allspring Govt MM Svc (NWGXX). We've made these changes in our Money Fund Intelligence Daily product, and they will also be reflected in the upcoming MFI XLS monthly when it ships in early September. Later this week, we'll see Invesco Liquid Assets Institutional (LAPXX), Invesco STIC Prime Institutional (SRIXX) and UBS Limited Purpose Cash Inv Fund (UBS03) liquidate.
Western Asset tells us in a "July 2024 Liquidity" update, "In the money markets, the front-end yield curve flattened significantly in July, while longer dated yields fell sharply with rate cuts drawing closer. Three-month Treasury bill yields fell by around 0.10% to 5.28% while three-month commercial paper yields fell by 0.10%-0.15% to a range between 5.30% and 5.35%. Usage of the Fed's Reverse Repurchase Program (RRP) ended July at $413 billion, with market expectations of a continued gradual decline in RRP balances as ongoing issuance in Treasury bills presents an attractively yielding source of supply for money market investors." (Note: There's still time to register for European Money Fund Symposium, which will be held Sept. 19-20, 2024 in London, England! We hope to see you there!)
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