MMFs Jump to 2.68%, Sweeps to 0.34%
Money fund yields jumped again last week -- our Crane 100 Money Fund Index (7-Day Yield) rose 34 basis points to 2.68% in the week ended Friday, 9/30. Yields rose by 24 basis points the previous week, 5 bps the week before that, and 3 basis points the week before that. On average, they're up from 1.57% on July 29, up from 1.18% on June 30 and more than quadruple their level of 0.58% on May 31. MMF yields are 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). Yields continue to surge higher as they digest the Fed's Sept. 21 75 bps rate hike. Our broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 679), shows a 7-day yield of 2.55%, up 32 bps in the week through Friday. The Crane Money Fund Average is up 152 bps since beginning of July and up 208 bps from 0.47% at the beginning of June. Prime Inst MFs were up 39 bps to 2.80% in the latest week, up 153 bps since the start of July and up 216 bps since the start of June (close to double from the month prior). Government Inst MFs rose by 30 bps to 2.59%, they are up 149 bps since start of July and up 205 bps since the start of June. Treasury Inst MFs up 25 bps for the week at 2.54%, up 150 bps since beginning of July and up 204 bps since the beginning of June. Treasury Retail MFs currently yield 2.33%, (up 27 bps for the week, up 153 bps since July and up 203 bps since June), Government Retail MFs yield 2.33% (up 33 bps for the week, up 154 bps since July started and up 207 bps since June started), and Prime Retail MFs yield 2.64% (up 37 bps for the week, up 157 bps from beginning of July and up 216 bps from beginning of June), Tax-exempt MF 7-day yields rose by 45 bps to 1.77%, they are up 121 bps since the start of July and up 139 bps since the start of June. According to Monday's Money Fund Intelligence Daily, with data as of Friday (9/30), 155 funds (out of 818 total) still yield between 0.00% and 1.99% with assets of $95.5 billion, or 1.9% of total assets; 245 funds yield between 2.00% and 2.49% with $1.061 trillion in assets, or 21.1%; 388 funds yielded between 2.50% and 2.99% with $3.501 trillion, or 69.5%; and just 30 funds yielded 3.00% or more ($378.4 billion, or 7.5%). Brokerage sweep rates also rose over the past week. Our Crane Brokerage Sweep Index, the average rate for brokerage sweep clients (almost all of which are swept into FDIC insured accounts; only Fidelity sweeps to a money market fund), rose this past week at 0.34%. The latest Brokerage Sweep Intelligence, with data as of Sept. 30, shows three rate changes over the previous week. Last week, Raymond James increased rates to 0.20% for all balances between $1K and $99K, to 0.40% for balances between $100K and $249K, to 1.00% for all balances between $250K and $999K and to 1.50% for all balances between $1 million and $4.9 million. Schwab increased rates to 0.40% for all balances between $1K and over $5 million. TD Ameritrade increased rates to 0.30% for all balances between $1K and over $5 million. Just 3 of 11 major brokerages still offer rates of 0.01% for balances of $100K (and most other tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley.
