Daily Links Archives: September, 2025
AFP on Liquidity in Flux, Survey
The Association for Financial Professionals (AFP), which will be hosting its AFP25 Annual Conference in Boston October 26-28, published a brief titled, "Liquidity in Flux: Prioritizing Safety in Uncertainty." They ask, "How are companies responding to today's uncertainties? According to the 2025 AFP Liquidity Survey, underwritten by Invesco, organizations managing short-term investments are keeping safety a top priority. The results also highlighted a continued preference for traditional cash management vehicles, with interest-bearing deposit accounts (and time deposits) leading the pack, followed by government money market funds and treasury securities. In a companion webinar to the 2025 AFP Liquidity Survey, a panel of experts discussed the implications of the survey findings for treasury professionals. Tariffs and trade policy are new territory for many practitioners. Laurie Brignac, Chief Investment Officer for Invesco, underscored just how unusual this development is. 'This is the first time in my entire career [30+ years] that we’ve even talked about tariffs,' she said." The article tells us, "Marcel Santiz, Treasury Director for Masco Corporation, noted that his company expects tariffs to reduce cash flow through higher costs and weaker consumer demand. 'The overall cash impact is, we would expect to be down because we're paying tariffs that we were not paying before,' said Santiz. While they plan to maintain year-end cash targets, tariffs and their impacts may reduce foot traffic at retail, which could result in headwinds." AFP explains, "Money market funds are enjoying historic levels. Assets recently reached $7.4 trillion, and panelist Peter Crane, President and Publisher, Crane Data, predicted they could climb to $8 trillion by year-end. The combination of safety and favorable yields has drawn both retail and institutional investors, especially as bank deposits plateau. 'Nobody really has to fight for yield right now,' said Crane. 'All of a sudden, you've got 5%, now 4%, and everybody's happy with those levels.' Government and treasury funds alone are offering levels not seen in years. Even if rates decline, the lag in money fund repricing means they will remain competitive, retaining their status as a central tool in corporate liquidity management. With the debt ceiling lifted, U.S. Treasury bill issuance is ramping back up, providing ample supply for money market funds. This alleviates concerns about a shortage of safe, short-term instruments." Finally, the piece says, "While there is plenty of growing interest in stablecoins, tokenized funds as collateral tools and EFTs, the panel agreed they are early-stage experiments. 'There's a lot of smoke,' said Crane. 'There's probably a little fire at this point, but there's so much smoke in there.' Santiz explained that he would be reluctant to pursue such investments due to counterparty and liquidity risks, especially given past experiences with alternative assets.... Brignac added that tokenized funds are currently structured as share classes of government money funds, making them stable-value products, but adoption will depend on building trust and demonstrating clear use cases. 'Stay tuned,' said Crane. 'There are a lot of developments there.' For more on the AFP Liquidity Survey, see our June 25 News, "More AFP Liquidity Survey: Bank Deposits, Money Funds and T-Bills Rule," and our June 20 News, "AFP 2025 Liquidity Survey: MMFs Inch Higher; Deposits, T-Bills Lower."
Crane 100 MF Index Lower to 4.10%
Money fund yields (7-day, annualized, simple, net) were down 1 bp at 4.10% on average during the week ended Friday, September 5 (as measured by our Crane 100 Money Fund Index), after remaining unchanged the week prior. Fund yields should stay relatively flat until after the Fed cuts rates on September 17. They've declined by 96 bps since the Fed first cut its Fed funds target rate by 50 bps on Sept. 18, 2024, and they've declined by 53 bps since the Fed last cut rates by 1/4 point on 11/7/24. Yields were 4.11% on 8/31, 4.12% on 7/31, 4.13% on 6/30, 4.10% on 5/31, 4.13% on 4/30/25, 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. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 677), shows a 7-day yield of 3.99%, down 1 bp in the week through Friday. Prime Inst money fund yields down 1 bp at 4.23% in the latest week. Government Inst MFs were unchanged at 4.11%. Treasury Inst MFs were down 1 bp at 4.03%. Treasury Retail MFs currently yield 3.79%, Government Retail MFs yield 3.81%, and Prime Retail MFs yield 4.02%, Tax-exempt MF 7-day yields were down 13 bps to 2.42%. Assets of money market funds rose by $50.2 billion last week to $7.653 trillion, according to Crane Data's Money Fund Intelligence Daily. MMF assets hit a record high of $7.663 trillion (on September 4) after their previous high of $7.633 trillion set on September 2. For the month of September (MTD), MMF assets have increased $50.2 billion after increasing by $132.0 billion in August, $63.7 billion in July, $6.7 billion in June, $100.9 billion in May, decreasing $24.4 billion in April, increasing by $2.8 billion in March, $94.2 billion in February, $52.8 billion in January, $110.9 billion in December, $200.5 billion in November, and $97.5 billion in October. Weighted average maturities were at 42 days for the Crane MFA and 42 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (9/5), 116 money funds (out of 789 total) yield under 3.0% with $143.8 billion in assets, or 1.9%; 266 funds yield between 3.00% and 3.99% ($1.339 trillion, or 17.5%), 407 funds yield between 4.0% and 4.99% ($6.170 trillion, or 80.6%) and following the recent rate cut there continue to be zero funds yielding 5.0% or more. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.40%, after falling 1 bp sixteen weeks prior. The latest Brokerage Sweep Intelligence, with data as of September 5, shows no changes over the past week. 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.
CoinDesk on BofA Tokenization Report
CoinDesk writes, "Tokenization Is 'Mutual Fund 3.0,' Bank of America Says." The article tells us, "Bank of America (BAC) sees tokenization, the creation of a virtual investment vehicle on the blockchain linked to a tangible asset, as the next phase in the evolution of investment products, describing it as 'mutual fund 3.0,' the Wall Street bank said in a Friday report. Just as mutual funds first emerged in 1924 and exchange-traded funds (ETFs) reshaped investing in the 2000s, blockchain technology could underpin a new generation of financial vehicles, analysts led by Craig Siegenthaler wrote." The piece continues, "Still, regulation remains a headwind. The GENIUS and Clarity Acts address stablecoins, but leave many questions about tokenized funds unresolved. Still, the bank argues, the advantages of tokenization will drive adoption over time despite limited access for U.S. investors today.... That shift pushed firms toward monetizing client cash and order flow, making tokenized versions of these assets less compelling, the bank's analysts said. But tokenized money market funds, powered by smart contracts, could upend those cash sweep economics and open new revenue models." CoinDesk adds, "Bank of America expects tokenized money market funds to lead adoption thanks to their attractive yields relative to stablecoins, which cannot pay interest under the Genius Act, with private credit and high yield likely to follow."
WisdomTree Treasury MM Digital Fund
WisdomTree Government Money Market Digital Fund (WTGXX), part of WisdomTree Digital Trust, filed to change its name to WisdomTree Treasury Money Market Digital Fund. The Prospectus update <b:> for the "Supplement dated August 28, 2025, to the currently effective Statutory Prospectus and Statement of Additional Information, dated November 1, 2024," says, "Effective on or about November 1, 2025 (the “Effective Date”), the Fund’s name, non-fundamental investment policy, and principal investment strategies will be revised. Why the Changes: `The impetus for the changes is to ensure the Fund's eligible investor base includes payment stablecoin issuers seeking to comply with newly enacted U.S. legislation, namely the Guiding and Establishing National Innovation for U.S. Stablecoins Act (the 'GENIUS Act') and any implementing regulations. These changes will align the Fund's portfolio with the reserve asset requirements set forth in GENIUS Act, positioning the Fund as an eligible investment option for such payment stablecoin issuers. The Fund will remain an investment option for other types of institutional investors as well as retail investors." Discussing, "What is Changing," the filing tells us, "Effective on or around November 1, 2025, the Fund's name, non-fundamental investment policy, and principal investment strategies will be amended as follows: Current - WisdomTree Government Money Market Digital Fund; Revised - WisdomTree Treasury Money Market Digital Fund." It says, "Under normal circumstances, at least 80% of the value of its net assets will be invested in government securities and repurchase agreements collateralized by government securities. Under normal circumstances, at least 80% of the value of its net assets will be invested in Treasury securities, repurchase agreements collateralized by Treasury securities and shares of registered Treasury money market funds. Accordingly, the Fund's eligible investment universe under its principal investment strategies will be narrowed to exclude U.S. government agency securities and U.S. Treasury securities with a remaining maturity greater than 93 days, which are not permissible reserve assets under the GENIUS Act. Because the Fund intends to invest in a narrower investment universe than under its current principal investment strategies, the Fund's yield may be lower than it is currently achieving and lower than other money market funds that are permitted to invest in a wider universe of investments." WisdomTree adds, "What is Not Changing: The Fund's investment objective will not change, whereby the Fund will continue to seek to provide investors with a high level of current income consistent with preservation of capital and liquidity and the maintenance of a stable $1.00 net asset value (NAV) per share. In addition, the Fund will continue to seek to operate in compliance with Rule 2a-7 under the Investment Company Act of 1940. Lastly, the Fund's management fee is not changing and its ticker symbol of WTGXX will remain the same." (For more, see Crane Data's Feb. 26, 2024 News," "WisdomTree Launches Digital Govt MMF; Tradias Tokenizes First Euro MF.")
Weekly Money Fund Portfolio Holdings
Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Wednesday (a day late due to the Labor Day Holiday), which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of August 29) includes Holdings information from 54 money funds (down 20 from a week ago), or $3.221 trillion (down from $4.250 trillion) of the $7.602 trillion in total money fund assets (or 42.4%) tracked by Crane Data. (Note: Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our August 12 News, "August Money Fund Portfolio Holdings: Repo Plummets, T-Bills Surge.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.537 trillion (down from $1.953 trillion a week ago), or 47.7%; Repurchase Agreements (Repo) totaling $1.129 trillion (down from $1.518 trillion a week ago), or 35.1%, and Government Agency securities totaling $298.9 billion (down from $362.8 billion a week ago), or 9.3%. Commercial Paper (CP) totaled $122.1 billion (down from $183.2 billion a week ago), or 3.8%. Certificates of Deposit (CDs) totaled $54.1 billion (down from $99.9 billion a week ago), or 1.7%. The Other category accounted for $46.6 billion or 1.4%, while VRDNs accounted for $33.3 billion or 1.0%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.537 trillion (47.7% of total holdings), Fixed Income Clearing Corp with $322.4B (10.0%), the Federal Home Loan Bank with $179.9B (5.6%), BNP Paribas with $90.2B (2.8%), JP Morgan with $86.5B (2.7%), RBC with $82.6B (2.6%), Federal Farm Credit Bank with $76.8B (2.4%), Citi with $76.0B (2.4%), Wells Fargo with $70.2B (2.2%) and Bank of America with $43.3B (1.3%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($299.3B), Fidelity Inv MM: Govt Port ($277.4B), JPMorgan 100% US Treas MMkt ($265.1B), Goldman Sachs FS Govt ($236.1B), Morgan Stanley Inst Liq Govt ($167.3B), Fidelity Inv MM: MM Port ($163.8B), State Street Inst US Govt ($159.6B), Dreyfus Govt Cash Mgmt ($146.0B), Allspring Govt MM ($128.3B) and First American Govt Oblg ($114.7B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)
Crane 100 MF Index Flat at 4.11%
Money fund yields (7-day, annualized, simple, net) were unchanged at 4.11% on average during the week ended Friday, August 29 (as measured by our Crane 100 Money Fund Index), after remaining unchanged the week prior. Fund yields should stay relatively flat until the Fed cuts rates again, perhaps in mid-September. They've declined by 95 bps since the Fed first cut its Fed funds target rate by 50 bps on Sept. 18, 2024, and they've declined by 52 bps since the Fed last cut rates by 1/4 point on 11/7/24. Yields were 4.11% on 8/31, 4.12% on 7/31, 4.13% on 6/30, 4.10% on 5/31, 4.13% on 4/30/25, 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. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 677), shows a 7-day yield of 4.00%, down 1 bp in the week through Friday. Prime Inst money fund yields didn't change at 4.24% in the latest week. Government Inst MFs were unchanged at 4.11%. Treasury Inst MFs were down 1 bp at 4.04%. Treasury Retail MFs currently yield 3.81%, Government Retail MFs yield 3.82%, and Prime Retail MFs yield 4.02%, Tax-exempt MF 7-day yields were up 10 bps to 2.55%. Assets of money market funds rose by $62.2 billion last week to $7.602 trillion, according to Crane Data's Money Fund Intelligence Daily.MMF assets hit a record high of $7.602 trillion (on August 29) after their previous high of $7.599 trillion set on August 28. For the month of August (MTD), MMF assets have increased $132.0 billion after increasing by $63.7 billion in July, $6.7 billion in June, $100.9 billion in May, decreasing $24.4 billion in April, increasing by $2.8 billion in March, $94.2 billion in February, $52.8 billion in January, $110.9 billion in December, $200.5 billion in November, $97.5 billion in October and $149.8 billion in September. Weighted average maturities were at 41 days for the Crane MFA and 41 days the Crane 100 Money Fund Index. According to Tuesday's Money Fund Intelligence Daily, with data as of Friday (8/29), 114 money funds (out of 789 total) yield under 3.0% with $136.9 billion in assets, or 1.8%; 256 funds yield between 3.00% and 3.99% ($1.326 trillion, or 17.4%), 419 funds yield between 4.0% and 4.99% ($6.140 trillion, or 80.8%) and following the recent rate cut there continue to be zero funds yielding 5.0% or more. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.40%, after falling 1 bp fifteen weeks prior. The latest Brokerage Sweep Intelligence, with data as of August 29, shows no changes over the past week. 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.
Reuters on OCBC Digital CP Launch
Reuters writes that "OCBC kicks off $1 billion digital US commercial paper programme." They explain, "Singapore's second-largest bank Oversea-Chinese Banking Corp (OCBC) said ... it has established a $1 billion digital U.S. commercial paper programme, bolstering its dollar funding capabilities. U.S. commercial papers are a relatively inexpensive funding source that corporations use to meet their immediate cash flow needs. Through the programme, OCBC aims to tap into the $1.4 trillion U.S. commercial paper market." The article says, "The bank has leveraged blockchain to establish the programme, which will complement its $25 billion conventional U.S. commercial paper programme established in August 2011. J.P. Morgan's Digital Debt Service application will act as the sole dealer. The funds raised will be used for general funding purposes, OCBC said." Kenneth Lai, OCBC's head of global markets, comments, "Singapore's blockchain ecosystem is advancing fast, and asset tokenisation is gaining real momentum. Our focus is now firmly on commercialisation." Reuters adds, "The first U.S. commercial paper tokenised issuance under the programme took place on August 20."
