Fitch: Liquidity LGIPs Up to $407.7B
Fitch Ratings published "Local Government Investment Pools: 2Q24," which says, "Fitch Ratings' two local government investment pool (LGIP) indices experienced an aggregate asset increase in the second quarter of 2024 (2Q24). Combined assets for the Fitch Liquidity LGIP Index and the Fitch Short-Term LGIP Index were $624 billion at the end of 2Q24, representing an increase of $9 billion qoq and $47 billion yoy. [Fitch says Liquidity LGIPs total $407.7B vs. Short-Term LGIPs at $216.7B.] The Fitch Liquidity LGIP Index was up 2.1% qoq and the Fitch Short-Term LGIP Index was up 0.4% qoq, compared to average growth of 6.0% and 6.9%, respectively, in the second quarter over the past three years." They comment, "Weighted average maturities (WAMs) decreased incrementally in 2Q24, as the Fed maintained a target range of 5.25%–5.5%. The WAM of the Fitch Liquidity LGIP Index decreased to 37 days, but is still higher than prime '2a-7' money market funds at 17 days. The Fitch Short-Term LGIP Index ended the quarter with a duration of 1.22 years, up 2.2% since last quarter.... Sector allocations were relatively consistent qoq for both indices. The Fitch Liquidity LGIP Index increased exposure to CP by 1.08% and decreased exposure to Government Agencies by 1.98% qoq. Exposure to Treasuries, Supranational, and Asset Backed Securities increased in aggregate by 0.84% qoq. The Fitch Short-Term LGIP Index decreased exposure to Treasuries by 1.76% and increased exposure to Government Agencies by 1.1% qoq. Both indices continue to have a majority of sector exposure to direct, guaranteed or securities collateralized by obligations of the U.S. Treasury and its instrumentalities/agencies."
