Our flagship Crane 100 Money Fund Index 7-Day Yield Average rose by 6 basis points to 1.29% in the week ended Friday, 7/15, after rising 4 basis points the previous week and 4 basis points the week before that. (It rose another 1 bp yesterday to 1.30%.) Money market fund yields have more than doubled from their level of 0.58% on May 31, and they're up from 0.21% on April 29, 0.15% on March 31 and 0.02% on February 28 (where they'd been for almost 2 years prior). Brokerage sweep rates also inched higher over the past week. Our latest Brokerage Sweep Intelligence shows brokerages paying an average of 0.16% on FDIC insured deposits, up from 0.04% a month ago and 0.01% two months ago. We review the latest money fund and brokerage sweep yields below.
The Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 671), shows a 7-day yield of 1.17%, up 12 bps in the week through Friday. The Crane Money Fund Average is up 70 bps from 0.47% at the beginning of June. Prime Inst MFs were up 6 bps to 1.38% in the latest week, and up 74 bps since the start of June (close to double from the month prior). Government Inst MFs rose by 9 bps to 1.24%, they are up 70 bps since the start of June. Treasury Inst MFs up 9 bps for the week at 1.20%, up 70 bps since the beginning of June. Treasury Retail MFs currently yield 0.94%, (up 7 bps for the week, and up 64 bps since June), Government Retail MFs yield 0.94% (up 10 bps for the week, and up 68 bps since June started), and Prime Retail MFs yield 1.18% (up 3 bps for the week, and up 70 bps from beginning of June), Tax-exempt MF 7-day yields dropped by 8 bps to 0.39%, they were down 1 bp since the start of June.
Our Crane Brokerage Sweep Index, the average rate for brokerage sweep clients (most of which are swept into FDIC insured accounts; only Fidelity sweeps to a money market fund), inched up a basis point to 0.16%. This follows increases over the past couple of months but also follows 2 straight years of yields at 0.01%. Sweep yields were 0.12% on average at the end of 2019 and 0.28% on average at the end of 2018. The latest Brokerage Sweep Intelligence, with data as of July 15, show just one change over the previous week.
Our latest Brokerage Sweep Intelligence reports that `Ameriprise Financial Services increased rates to 0.10% for balances between $100K and $250K, to 0.12% for balances between $250K and $1 million, to 0.14% for balances between $1 million and $5 million and to 0.16% for balances of $5 million and more for the week ended July 15. Just four of 11 major brokerages still offer rates of 0.01% for balances of $100K (and most other tiers). These include: E*Trade, Merrill Lynch, Morgan Stanley, and UBS.
According to Monday's Money Fund Intelligence Daily, with data as of Friday (7/15), just 20 funds (out of 818 total) still yield 0.00% or 0.01% with assets of $4.1 billion, or 0.1% of total assets. (This compares to 593 funds with $2.623 trillion yielding 0.00% or 0.01% at the beginning of the year.) There were 90 funds yielding between 0.02% and 0.49%, totaling $45.6B, or 0.9% of assets; 208 funds yield between 0.50% and 0.99% with $250.4 trillion in assets, or 5.0%; 188 funds yield between 1.00% and 1.24% with $1.450 trillion in assets or 29.1%; 237 funds yielded between 1.25% and 1.49% with $2.430 trillion or 48.7%; and 75 funds yielded over 1.50% ($809.2 billion, or 16.2%).
In other news, ICI released its latest monthly "Money Market Fund Holdings" summary, which reviews the aggregate daily and weekly liquid assets, regional exposure, and maturities (WAM and WAL) for Prime and Government money market funds.
The MMF Holdings release says, "The Investment Company Institute (ICI) reports that, as of the final Friday in June, prime money market funds held 32.6 percent of their portfolios in daily liquid assets and 49.4 percent in weekly liquid assets, while government money market funds held 87.3 percent of their portfolios in daily liquid assets and 92.7 percent in weekly liquid assets." Prime DLA was down from 32.8% in May, and Prime WLA was unchanged at 49.4%. Govt MMFs' DLA increased from 86.0% in May and Govt WLA decreased from 93.0% the previous month.
ICI explains, "At the end of June, prime funds had a weighted average maturity (WAM) of 16 days and a weighted average life (WAL) of 57 days. Average WAMs and WALs are asset-weighted. Government money market funds had a WAM of 28 days and a WAL of 71 days." Prime WAMs and WALs were both unchanged from the previous month. Govt WAMs were 1 day shorter and WALs were 3 days shorter from May.
Regarding Holdings by Region of Issuer, the release tells us, "Prime money market funds' holdings attributable to the Americas rose from $165.23 billion in May to $204.49 billion in June. Government money market funds' holdings attributable to the Americas rose from $3,678.54 billion in May to $3,798.43 billion in June."
The Prime Money Market Funds by Region of Issuer table shows Americas-related holdings at $204.5 billion, or 47.5%; Asia and Pacific at $85.9 billion, or 19.9%; Europe at $134.4billion, or 31.2%; and, Other (including Supranational) at $6.0 billion, or 1.5%. The Government Money Market Funds by Region of Issuer table shows Americas at $3.798 trillion, or 95.0%; Asia and Pacific at $73.5 billion, or 1.8%; Europe at $111.0 billion, 2.8%, and Other (Including Supranational) at $15.4 billion, or 0.4%.
