MMF Yields, Sweep Rates Creep Lower
Money fund yields slid 2 basis points to 4.73% on average in the week ended Oct. 4 (as measured by our Crane 100 Money Fund Index, an average of 7-day yields for the 100 largest taxable money funds), after falling 18 bps the week prior. 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, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. Yields should continue to inch lower as they digest the final remnants of the Fed cut, then they should stabilize until the next cut. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 655), shows a 7-day yield of 4.63%, down 3 bps in the week through Friday. (Four weeks prior was the first time our Crane MFA fell below 5.0% since July 2023.) Prime Inst money fund yields were unchanged at 4.83% in the latest week. Government Inst MFs were down 1 bp at 4.74%. Treasury Inst MFs were down 5 bps at 4.69%. Treasury Retail MFs currently yield 4.47%, Government Retail MFs yield 4.45%, and Prime Retail MFs yield 4.60%, Tax-exempt MF 7-day yields were down 34 bps to 2.62%. Assets of money market funds rose by $4.0 billion last week to $6.795 trillion according to Crane Data's Money Fund Intelligence Daily. Assets reached its record high Thursday Oct. 3 at $6.816 trillion. For the month of October, MMF assets have increased by $30.0 billion, after increasing by $149.8 billion in September. Weighted average maturities were up 1 day at 33 days for the Crane MFA and up 1 day at 32 days for the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (10/4), 107 money funds (out of 773 total) yield under 3.0% with $111.2 billion in assets, or 1.6%; 36 funds yield between 3.00% and 3.99% ($35.8 billion, or 0.5%), 613 funds yield between 4.0% and 4.99% ($6.396 trillion, or 94.1%) and just 17 funds now yield 5.0% or more ($251.5 billion, or 3.7%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was down (2 bps) at 0.52% after dropping 8 basis points the previous week. The latest Brokerage Sweep Intelligence, with data as of Oct. 4, shows that there were two changes over the past week. Raymond James lowered rates to 0.20% for all accounts up to $99K, to 0.30% for all accounts between $100k and $249K, to 0.65% for all accounts between $250K and $999K, and lowered rates to 2.00% for accounts between $1 million and $9.9 million, they also lowered rates to 2.75% for accounts of $10 million and greater. Merrill Lynch lowered rates for a second week in a row for their advisory accounts, now at 4.78% (down 4 bps). Three of the 10 major brokerages tracked by our BSI still offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley. (Note: Two weeks prior we added advisory rates to Brokerage Sweep Intelligence for Merrill Lynch and Morgan Stanley.)
