The February issue of our flagship Money Fund Intelligence newsletter, which will be sent to subscribers Friday morning, features the articles: "MMMF Assets Cool Down in January; Seasonal Trends," which discusses the slowing growth in money funds; "Federated Hermes' Q4'25 Call Talks Flows, Tokenized MMFs," which cites highlights from the recent earnings call; and "PFII on CA, NY, NH and PA LGIPs; Seeking Disclosures," which reviews a recent article from The Public Funds Investment Institute. We will also send out our MFI XLS spreadsheet Friday a.m., and we've updated our Money Fund Wisdom database with 1/31/25 data. Our February Money Fund Portfolio Holdings are scheduled to ship on Tuesday, Feb. 10, and our February Bond Fund Intelligence is scheduled to go out on Friday, Feb. 13.
MFI's "MMF Assets Cool Down" story says, "Money fund assets increased by $38.5 billion to a record $8.160 trillion in January, according to our Money Fund Intelligence XLS. The asset slowdown follows 5 straight months of $100+ billion increases, but normally January sees outflows. We show the average monthly change in money fund assets over the past 15 years (2011-2025) in the chart below. January is the second weakest month (after June) and normally sees outflows of about $14 billion. (Note that March and April are normally very weak, but these were inflated by huge inflows in 2020 due to the Covid shutdown and 2023 due to the SVB bankruptcy.)"
The story continues, "Assets increased by $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose $63.7 billion in July, $6.7 billion in June and $100.9 billion in May. MMFs fell by $24.4 billion in April, but rose $2.8 trillion in March, $94.2 billion in February and $52.8 billion last January. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're almost $400 billion lower than Crane's asset series."
We write in the "Federated," story, "Federated Hermes reported it Q4'25 earnings and hosted its Q4'25 earnings call late last week. In the press release, President & CEO J. Christopher Donahue, says, 'Federated Hermes' record assets at year-end were again driven by money market asset increases, as our liquidity products provided attractive cash management resources and opportunities for risk adjusted returns. We also continued to see ... interest in our growing range of investment solutions beyond mutual funds, including ETFs, CITs and SMAs.'"
It adds, "Donahue explains on the call, 'We reached another record high at the end of 2025 for total money market assets, which increased by $30 billion to reach $683 billion. Money market fund assets increased by $16 billion or 3% in Q4 to reach a record high of $508 billion. Money market separate accounts increased by $14 billion in the fourth quarter, reflecting seasonal patterns. Market conditions remain favorable for cash as an asset class. In addition to the appeal of relative safety in periods of volatility, money market strategies present opportunities to earn attractive yields compared to alternatives such as bank deposits and direct investments in T-bills and commercial paper.'"
Our "LGIP" article says, "The Public Funds Investment Institute (PFII) writes on 'LGIPs: New Pools and Manager Changes.' They explain, 'In October 2024 we wrote about local government investment pools changing managers. It's unusual but not unheard of in the LGIP business. Sometimes an LGIP simply replaces a manager and sometimes local governments band together to create a new fund to bring in a manager or expand competition in a state. We've seen both recently.'"
It continues, "The PFII writes, 'California: CalFIT (California Fixed Income Trust) is a new LGIP that began offering a stable value portfolio in the fall. It invests in government and high grade corporate and bank obligations and is managed by Chandler Asset Management, a California based firm that entered the LGIP business in 2024 when it replaced Public Trust Advisors as manager of the FL SAFE LGIP in Florida. As of December 31, 2025, CalFIT reported $331 million in assets. California has a long-established state-sponsored and three other local sponsored LGIPs. Large states are well able to support multiple LGIPs. California joins Florida and Texas in this regard.'"
MFI also includes the News brief, "Money Fund Yields Stabilize at 3.5%, Lowest Since 11/22." It says, "Yields (7-day, annualized, simple, net) fell by 8 bps to 3.50% on average during January (as measured by our Crane 100 Money Fund Index). Fund yields should remain flat given that the Fed left rates unchanged at its Jan. 28 meeting. Yields haven't been below 3.5% since Nov. 2022. They're down from a recent high of 5.20% in Nov. 2023. MMF yields were 3.58% on 12/31/25, 3.94% on 9/30, 4.13% on 6/30, 4.14% on 3/31/25 and 4.28% on average on 12/31/24. MMFs averaged 4.75% on 9/30/24, 5.10% on 6/28/24, 5.14% on 3/31/24 and 5.20% on 12/31/23."
Another News brief, "Fed Z.1 Shows Jump in Household, Corporate Assets; T-Bills Surge in Q3," comments, "The Federal Reserve's latest quarterly 'Z.1 Financial Accounts of the United States' statistical survey (a.k.a. 'Flow of Funds') includes 4 tables on money market mutual funds. The Third Quarter 2025 edition shows that Total MMF Assets increased by $293 billion to $7.774 trillion in Q3’25. The Household Sector, by far the largest investor segment with $5.035 trillion, saw the biggest asset increase in Q3, followed by Nonfinancial Corporate Business and Other Financial Business (formerly Funding Corps). 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 Mutual Funds and Rest of the World categories in Q3 2025."
A third News brief, "MMFs in Retirement Plans Approach $1 Trillion," says: "The Investment Company Institute published, 'Retirement Assets Total $48.1 Trillion in Third Quarter 2025,' which includes data tables showing that money market funds held in retirement accounts jumped to $987 billion (up from $966 billion) in the latest quarter, accounting for 13% of the total $7.321 trillion in money funds. MMFs represent just 6.8% of the total $14.5 trillion of mutual funds in retirement accounts."
A sidebar, "BlackRock Q4 Call on Cash," says, "BlackRock CFO Martin Small comments on their latest earnings call, 'BlackRock Cash Management saw $74 billion of net inflows in the fourth quarter and $131 billion in 2025, driven by U.S. Government, International, Prime and Circle Reserve Funds. BlackRock’s platform is anchored by growth engines tied to the long-term expansion of global capital markets and fast-growing client product channels.'"
Our February MFI XLS, with January 31 data, shows total assets rose $38.5 billion to a record high $8.160 trillion, after increasing $123.5 billion in December, $129.3 billion in November, $141.5 billion in October, $100.4 billion in September, $129.9 billion in August, $69.0 billion in July, $10.1 billion in June and jumping $90.3 billion in May. MMFs decreased $26.6 billion in April and $4.6 billion in March. Assets increased $90.4 billion last February.
Our broad Crane Money Fund Average 7-Day Yield was down 7 bps at 3.40%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) was down 8 bps at 3.50% in January. On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 averaged 3.77% and 3.77%. Charged Expenses averaged 0.37% 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 1/31/26 on Monday, 2/9.) The average WAM (weighted average maturity) for the Crane MFA was 39 days (up 1 day) and the Crane 100 WAM was up 2 days from the previous month at 42 days. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)
