The July issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Monday morning, features the articles: "AFP Liquidity Survey: Banks, MMFs, T-Bills Kings of Cash," which breaks down the latest trends in corporate cash; "Money Fund Symposium '24: Records, 5%, Big Prime Shift," which quotes from our recent Money Fund Symposium in Pittsburgh; and, "ICI Worldwide: MMFs Rise to $10.4 Tril. in Q1'24; US, China," which reviews the latest figures on money fund markets outside of the U.S. We also sent out our MFI XLS spreadsheet Monday a.m., and we've updated our Money Fund Wisdom database with 6/30/24 data. Our July Money Fund Portfolio Holdings are scheduled to ship on Wednesday, July 10, and our July Bond Fund Intelligence is scheduled to go out on Monday, July 15. (Note: We may not be publishing our latest Form N-MFP files and revisions on Tuesday, July 9. The SEC has changed the format of these files as their new regulations go into effect, so it may take us a number of weeks to revise our programs and collections. We'll keep you posted!)
MFI's "AFP" article says, "We wrote late last month on the '2024 AFP Liquidity Survey.' (See our June 24 News, 'AFP 2024 Liquidity Survey: Cash Still King Among Corporates, Increasing.') Below, we excerpt from `some of the highlights of the annual survey of corporate investors' cash habits. Discussing 'Current Allocations of Short-Term Investments,' AFP says, 'Companies maintain their investments in relatively few vehicles. Organizations invest in an average 2.7 vehicles for their cash and short-term investments -- unchanged from the average in 2023. Most organizations continue to allocate a large share of their short-term investment balances -- an average of 83% -- in safe and liquid investment vehicles: bank deposits, money market funds (MMFs) and Treasury securities. This result is four percentage points higher than the 79% reported in 2023 -- and the highest percentage on record since AFP began tracking the data.'"
It continues, "They explain, 'The typical organization currently maintains 47% of its short-term investments in bank deposits. This allocation is the same as reported last year (2023) but is 8 percentage points lower than the 55% reported in 2022, and lower than both the 52% reported in 2021 and the 51% in 2020. This year's allocation is similar to percentages reported in 2019 (46%) and 2018 (49%).'"
We write in our MFS'24 article, "Crane Data recently hosted its Money Fund Symposium conference in Pittsburgh, where almost 600 money market professionals discussed rates, pending reforms, asset inflows and a number of other hot topics in cash. The opening session, 'Keynote: Fifty Years of Managing Money Funds' featured Federated Hermes' CEO Chris Donahue, who comments, 'Liquidity for me is the Eighth Wonder of the World, and money market funds make it that way.... Money market funds enable the capital markets to flow, enable cities to grow, enable wildlife to flourish. You know, the Irish said that Guinness was Mother's milk. I contend it's money market funds.' (Note: Conference materials and recordings are available in our 'Money Fund Symposium 2024 Download Center.')"
It tells us, "Laurie Brignac of Invesco, was asked about Money Fund Reforms during the 'Major Money Fund Issues 2024' segment. She comments, 'I think everybody in the room is painfully aware of the reforms and everything that's kind of going into that.... It's unfortunate, not surprising, seeing some of the transitions, the liquidations and things like that. We actually just filed today, so we will be liquidating our prime institutional funds, which is really sad because one of them is our oldest money market fund. It is 43 years old, so not quite 50.... But unfortunately, the mandatory liquidity fee is just not something that's going to be tenable to a lot of clients. So, we made that decision.'"
Our "ICI Worldwide" piece says, "The Investment Company Institute published, 'Worldwide Regulated Open-Fund Assets and Flows, First Quarter 2024,' which shows that money fund assets globally decreased $35.6 billion, or -0.3%, in Q1'24 to $10.405 trillion. But the series excluded Australia's 6th largest $286.7 billion, so assets would have increased by $236.8 billion (or 2.3%) with Australia included. Increases were led by a sharp jump in money funds in U.S. and China, while Luxembourg and Mexico also rose. Meanwhile, money funds in Ireland, Chile and Japan were lower. MMF assets worldwide increased by $944.5 billion, or 10.0%, in the 12 months through 3/31/24, and money funds in the U.S. represent 57.5% of worldwide assets."
It continues, "ICI says, 'On a US dollar-denominated basis, equity fund assets increased by 4.1% to $33.08 trillion at the end of the first quarter of 2024. Bond fund assets increased by 0.8% to $13.00 trillion in the first quarter. Balanced/mixed fund assets increased by 0.5% to $7.33 trillion in the first quarter, while money market fund assets decreased by 0.3% globally to $10.41 trillion.'"
MFI also includes the News brief, "MMF Assets Retake Record in July. ICI's latest weekly 'Money Market Fund Assets' show assets jumping by over $50 billion to a record $6.154 trillion. Assets have risen in 10 of the last 11 weeks, increasing by $185.5 billion (or 3.1%) since April 24. MMF assets are up by $267 billion, or 5.6%, YTD in 2024 (through 7/2/24). Crane Data's separate Money Fund Intelligence Daily series shows money fund assets rising by $61.7 billion in July, through 7/2, to a record $6.551 trillion. (Our MFI XLS shows assets up $11.8 billion in June to a record $6.487 trillion.)"
Another News brief, "Invesco Files to Liquidate Prime Inst MMFs; UBS MF Converting to Retail," says, "An SEC filing for Invesco Liquid Assets Portfolio and Invesco STIC Prime Portfolio tells us, 'On June 11, 2024, the Board of Trustees of Short-Term Investments Trust approved a Plan of Liquidation and Dissolution, which authorizes the termination, liquidation and dissolution of the Funds.' In related news, UBS Select Prime Preferred Fund announced that the fund will change to Retail.'"
A third News brief, "BlackRock Liquidates TempFund, LEAF," tells readers, "BlackRock also filed to liquidate 2 of its 3 Prime Institutional money funds, bringing the number of Prime Inst MMFs liquidating or converting to Government to 12 to date (with total assets of $245.8 billion, or 38.7% the $635.8 billion in Prime Inst MMFs)."
A sidebar, "Fidelity Intl Tokenizes MMF," says, "CoinDesk writes, 'Fidelity International Tokenizes Money Market Fund on JPMorgan's Blockchain,' which says, 'Fidelity International ... has tokenized shares in a money market fund (MMF) using JPMorgan's Ethereum-based private blockchain network, Onyx Digital Assets. Tokenization occurred near instantaneously through connectivity between the fund's transfer agent (JPMorgan's transfer agency business) and Tokenized Collateral Network ... said Fidelity International, a separate entity to U.S.-based FMR.'"
Our July MFI XLS, with June 30 data, shows total assets increased $11.8 billion to $6.487 trillion, after increasing $79.7 billion in May, decreasing $17.6 billion in April, $66.7 billion in March, increasing $50.0 billion in February, $87.0 billion in January, $24.5 billion in December and $219.8 billion in November. Assets decreased $39.3 billion in October, but increased $77.8 billion in September, $104.2 billion in August and $21.0 billion in July.
Our broad Crane Money Fund Average 7-Day Yield was down 1 bp at 5.02%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) was down 1 bp to 5.13% in June. On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 averaged 5.40% and 5.39%, respectively. Charged Expenses averaged 0.38% and 0.26% for the Crane MFA and the Crane 100. (We'll revise expenses once we upload the SEC's Form N-MFP data for 6/30/24, though this may take some time as we adjust to the new N-MFP format.) The average WAM (weighted average maturity) for the Crane MFA was 34 days (unchanged) and the Crane 100 WAM was down 1 bp from previous month at 34 days. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)
