The October issue of our flagship Money Fund Intelligence newsletter, which was sent to subscribers Monday morning, features the articles: "Assets Spike to Record $6.8T; Yields Plunge to 4.7% on Cut," which reviews the jump in assets and drop in yields following the big Fed cut; "European MF Symposium: Breaking Records in London," which quotes from our recent offshore MMF conference; and, "Worldwide MMFs Jump in Q2'24, Hit Record $10.6 Tril.," which recaps the latest statistics on money fund markets outside the U.S. We also sent out our MFI XLS spreadsheet Monday a.m., and we've updated our Money Fund Wisdom database with 9/30/24 data. Our Oct. Money Fund Portfolio Holdings are scheduled to ship on Wednesday, October 9, and our Oct. Bond Fund Intelligence is scheduled to go out on Tuesday, October 15 (a day late due to the Columbus Day Holiday). (Note: Please join us for our "basic training" event, Money Fund University, which takes place Dec. 19-20 in Providence, R.I.)
MFI's "Assets Spike" article says, "Money fund yields moved sharply lower following the Federal Reserve's Sept. 18 50 basis point rate cut. They quickly fell below 5.0% and are now stabilizing at around 4.75% on average. Meanwhile, money market mutual fund assets jumped to all-time records, rising $155.2 billion in September to a record $6.777 trillion, according to MFI. They've continued rising in October, breaking the $6.8 trillion level on Thursday (10/3)."
It continues, "Money fund yields fell 35 basis points to 4.75% on average in September (as measured by our Crane 100 Money Fund Index, an average of 7-day yields for the 100 largest taxable money funds). Yields were 5.10% on 8/31, 5.13% on 7/31 and 6/28, 5.14% on 5/31, 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23. Yields should continue to inch lower as they digest the final remnants of the Fed cut, then they should stabilize until the next cut."
We write in our European MF Symposium article, "Crane Data recently hosted its 10th annual European Money Fund Symposium in London, England, which featured record attendance (210) and two days of discussions on offshore money funds denominated in USD, EUR and GBP. Veronica Iommi, Secretary General of IMMFA, the Institutional Money Market Funds Association, presented on 'The State of MMFs in Europe.' She began by looking at the current MMF landscape in Europe, including a brief reminder of how IMMFA MMFs have performed in recent years followed by a review of where we are on the regulatory front, what this might mean for us looking forwards and IMMFA's role as a voice of the Money Market Fund industry."
It states, "She tells the audience, 'Since last year, there have also been some developments at IMMFA ... including the decision to increase our focus on technology and the tokenization of money market funds. We welcomed four new associate members specializing in fin-tech to the IMMFA family, namely Cachematrix, Calastone, Fund Connect and Morgan Money. These new associate members joined existing members in a working group which has already been very actively engaged in discussions with regulators and policymakers.'"
Our "Worldwide" piece says, "The Investment Company Institute's 'Worldwide Regulated Open-Fund Assets and Flows, Second Quarter 2024,' shows that money fund assets globally rose by $201.6 billion, or 1.9%, in Q2’24 to $10.643 trillion. Increases were led by a sharp jump in money funds in U.S. and China, while Luxembourg and India also rose. Meanwhile, money funds in Brazil and Japan were lower. MMF assets worldwide increased by $923.8 billion, or 9.5%, in the 12 months through 6/30/24."
The piece states, "According to Crane Data's analysis of ICI's 'Worldwide' fund data, the U.S. sustained its position as the largest money fund market in Q2'24 with $6.092 trillion, or 57.2% of all global MMF assets. U.S. MMF assets increased by $172.7 billion (2.9%) in Q2'24 and have increased by $642.1 billion (11.8%) in the 12 months through June 30, 2024. China remained in second place among countries overall. China saw assets increase $226.3 billion (14.2%) in Q2 to $1.815 trillion (17.1% of worldwide assets). Over the 12 months through June 30, 2024, Chinese MMFs have increased $231.3 billion, or 14.6%."
MFI also includes the News brief, "Fed Goes Big, Cuts Rates by 50 Bps. A release titled, 'Federal Reserve issues FOMC statement,' tells us, 'In light of the progress on inflation and the balance of risks, the Committee decided to lower the target range for the federal funds rate by 1/2 percentage point to 4-3/4 to 5 percent.'"
Another News brief, "Bloomberg Says, 'Money-Market Funds Stay in Vogue Even as Reforms Go Into Effect.' They write, 'Money-market funds are attracting record amounts of cash, even as a regulatory overhaul [goes live].... The [SEC] approved measures last year.... The final piece of the reform requiring fund managers to impose mandatory liquidity fees went into effect [Oct. 2]."
A third News brief, "Texas Capital Launches Govt MM ETF," states, "A release, 'Texas Capital Launches Government Money Market Exchange Traded Fund,' claims, 'Texas Capital Bank Private Wealth Advisors, a subsidiary of Texas Capital Bank, and the Texas Capital Funds Trust … announced the launch of the Texas Capital Government Money Market ETF (MMKT).'"
A sidebar, "Janus MMF to Support ACS," says, "A press release titled, 'Janus Henderson Offers Money Market Fund to Support the American Cancer Society,' states, 'Janus Henderson ... and the American Cancer Society (ACS) ... announced an innovative partnership to support cancer research, advocacy, and patient support. Through this pioneering initiative, Janus Henderson will donate an amount equal to half of its management fees for all assets under management from Janus Henderson’s Government Money Market Fund to ACS. Janus Henderson has committed to donating a minimum of $1 million per year to ACS for the next three years through this innovative partnership to support the fight against cancer.'"
Our October MFI XLS, with Sept. 30 data, shows total assets increased $155.2 billion to a record $6.777 trillion, after increasing $105.6 billion in August, $19.7 billion in July, $11.8 billion in June and $79.7 billion in May. They decreased $17.6 billion in April and $66.7 billion in March, but increased $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 last October and increased $77.8 billion last September.
Our broad Crane Money Fund Average 7-Day Yield was down 34 bps at 4.65%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) was also down 35 bps at 4.75% in September. On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 averaged 5.04% and 5.01%. Charged Expenses averaged 0.38% and 0.27% for the Crane MFA and the Crane 100. (We'll revise expenses once we upload the SEC's Form N-MFP data for 9/30/24 on Tuesday, 10/8.) The average WAM (weighted average maturity) for the Crane MFA was 31 days (down 2 bp) and the Crane 100 WAM was down 3 bps from the previous month at 30 days. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)
