The Federal Reserve released its latest quarterly "Z.1 Financial Accounts of the United States" statistical survey (a.k.a. "Flow of Funds") late last week, and among the 4 tables it includes on money market mutual funds, the First Quarter 2025 edition shows that Total MMF Assets increased by $155 billion to $7.398 trillion in Q1'25. The Household Sector, by far the largest investor segment with $4.837 trillion, saw the biggest asset increase in Q1, followed by Nonfinancial Corporate Businesses. The Fed's latest Z.1 numbers, which contain one of the few looks at money fund investor segments available, also showed noticeable increases for the Other Financial Business (formerly Funding Corps) and Rest of the World categories in Q1 2025. (Note: For those attending our upcoming Money Fund Symposium, which is June 23-25, 2025 in Boston, we look forward to seeing you next week! Attendees and subscribers may access the conference materials via our "Money Fund Symposium 2025 Download Center.")
Rest of World, State & Local Governments, Exchange-traded funds, State & Local Govt Retirement and Nonfin Noncorporate Business categories saw small asset increases in Q1, while the Mutual funds, Private Pension Funds, Property-Casualty Insurance and Life Insurance Companies categories saw the only asset decreases last quarter. Over the past 12 months, the Household Sector, Nonfinancial Corporate Business, Other Financial Business and Rest of World categories showed the biggest asset increases, while Mutual funds and Private Pension Funds saw the biggest asset decreases.
The Fed's "Table L.206," "Money Market Mutual Fund Shares," shows that total assets increased by $155 billion, or 2.1%, in the first quarter to $7.398 trillion. The largest segment, the Household sector, totals $4.837 trillion, or 65.4% of assets. The Household Sector increased by $119 billion, or 2.5%, in the quarter. Over the past 12 months through March 31, 2025, Household assets were up $732 billion, or 17.8%.
Nonfinancial Corporate Businesses, the second-largest segment according to the Fed's data series, held $980 billion, or 13.2% of the total. Assets here increased by $18 billion in the quarter, or 1.8%, and they've increased by $107 billion, or 12.2%, over the past year. Other Financial Business was the third-largest investor segment with $530 billion, or 7.2% of money fund shares. This category jumped $19 billion, or 3.8%, in the latest quarter. Other Financial Business, which we believe includes Securities Lending, has increased by $90 billion, or 20.3%, over the previous 12 months.
The Rest of World moved up to fourth place in market share among investor segments with 2.9%, or $218 billion, The fifth-largest segment, Mutual Funds (a recent addition to the tables), held $201 billion (2.7%). Private Pension Funds was the 6th largest category with 2.6% of money fund assets ($192 billion); it was down $600 million for the quarter and down $4 billion, or -2.1% over the last 12 months. while Nonfinancial Noncorporate Business held $143 billion (1.9%), Life Insurance Companies held $101 billion (1.4%), State & Local Governments held $83 billion (1.1%), Property-Casualty Insurance held $51 billion (0.7%), Exchange-traded Funds held $38 billion (0.5%), and State & Local Govt Retirement held $25 billion (0.3%) according to the Fed's Z.1 breakout.
The Fed's "Flow of Funds" Table L.121 shows "Money Market Mutual Funds" largely invested in “Security Repurchase Agreements” with $2.821 trillion, or 38.1% and "Debt Securities," or Credit Market Instruments, with $4.253 trillion, or 57.5% of the total. Debt securities includes: Open market paper ($324 billion, or 4.4%; we assume this is CP), Treasury securities ($2.881 trillion, or 38.9%), Agency and GSE-backed securities ($902 billion, or 12.2%), Municipal securities ($138 billion, or 1.9%) and Corporate and foreign bonds ($8 billion, or 0.1%).
Another large MMF position in the Fed's series includes `Time and savings deposits ($320 billion, or 4.3%). Money funds also hold minor positions in Miscellaneous assets ($3 billion, or 0.0%) and Foreign deposits ($1 billion, 0.0%). Note: The Fed also lists "Variable Annuity Money Funds," which currently total $50 billion.
During Q1, Debt Securities were down $74 billion. This subtotal included: Open Market Paper (up $24 billion), Treasury Securities (down $114 billion), Agency- and GSE-backed Securities (up $16 billion), Corporate and Foreign Bonds (up $200 million) and Municipal Securities (down $200 million). In the first quarter of 2025, Security Repurchase Agreements were up $201 billion, Foreign Deposits were down $3 billion, Time and Savings Deposits were up by $56 billion, and Miscellaneous Assets were down $25 billion.
Over the 12 months through 3/31/25, Debt Securities were up $511 billion, which included Open Market Paper (up $8B), Treasury Securities (up $317B), Agencies (up $174B), Municipal Securities (up $10B), and Corporate and Foreign Bonds (up $2B). Foreign Deposits (down $4 billion), Time and Savings Deposits were down $18B, Securities repurchase agreements were up $440 billion and Miscellaneous Assets were up $29B.
The L.121 table shows `Stable NAV money market funds with $7,054 billion, or 95.4% of the total (up $149.2B or 2.2% in Q1 and up $1.275 trillion or 22.1% over 1-year), and Floating NAV money market funds with $344 billion, or 4.6% (up $5.5B or 1.6% in Q1 and down $318B or -48.0% over 1-year). Government money market funds total $6.000 trillion, or 81.1% (up $89.2B or 1.5% in Q1 and up $1.086 trillion or 22.1% over 1-year), Prime money market funds total $1.256 trillion, or 17.0% (up $64.8B or 5.4% in Q1 and down $143B or -10.2% over 1-year) and Tax-exempt money market funds $142B, or 1.9% (up $0.6B or 0.4% in Q1 and up $13B or 10.4% last year).
Note that the Federal Reserve made some changes to its Z.1 tables several years ago. Describing a "Money market funds sector data source change," the report says, "The money market mutual funds (MMF) sector (tables F.121 and L.121) has been revised beginning 2010:Q4 to reflect a change in data source to Securities and Exchange Commission Form NMFP. The level of assets and shares outstanding of the sector have increased due to the inclusion of private placement MMFs in the source data. Changes in the level due to changes in the data source in 2010:Q4 are recorded as other volume changes in the Financial Accounts."
On "Mutual funds sector holdings of money market funds," Z.1 tells us, "The mutual funds sector (tables F.122 and L.122) has been revised beginning 2010:Q4 to reflect holdings of money market funds not previously reported on the tables. In addition, holdings of repurchase agreements, commercial paper, corporate bonds, and miscellaneous assets have been revised. Additional and revised holdings are estimated using data from Morningstar and Investment Company Institute.... The exchange-traded funds sector (tables F.124 and L.124) has been revised beginning 2010:Q4 to reflect holdings of money market funds not previously reported on the tables."
