Link of The Day
The Investment Company Institute's latest weekly "Money Market Fund Assets" report shows money fund assets jumping by $45.5 billion to $7.567 trillion after decreasing by $15.7 billion to $7.522 trillion last week (and reaching a record high of $7.536 trillion the week prior). Assets have risen in 8 of the last 10 weeks, and 16 of the past 19 weeks. MMF assets are up by $892 billion, or 13.4%, over the past 52 weeks (through 11/25/25), with Institutional MMFs up $530 billion, or 13.2% and Retail MMFs up $362 billion, or 13.6%. Year-to-date, MMF assets are up by $717 billion, or 10.5%, with Institutional MMFs up $418 billion, or 10.1% and Retail MMFs up $299 billion, or 10.9%. ICI's weekly release says, "Total money market fund assets increased by $45.51 billion to $7.57 trillion for the six-day period ended Tuesday, November 25.... Among taxable money market funds, government funds increased by $41.22 billion and prime funds increased by $3.66 billion. Tax-exempt money market funds increased by $641 million." ICI's stats show Institutional MMFs increasing $43.7 billion and Retail MMFs increasing $1.8 billion in the latest week. Total Government MMF assets, including Treasury funds, were $6.208 trillion (82.0% of all money funds), while Total Prime MMFs were $1.215 trillion (16.1%). Tax Exempt MMFs totaled $144.5 billion (1.9%). It explains, "Assets of retail money market funds increased by $1.83 billion to $3.03 trillion. Among retail funds, government money market fund assets increased by $1.37 billion to $1.91 trillion, prime money market fund assets decreased by $230 million to $991.71 billion, and tax-exempt fund assets increased by $689 million to $132.49 billion." Retail assets account for 40.1% of the total, and Government Retail assets make up 63.0% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $43.69 billion to $4.53 trillion. Among institutional funds, government money market fund assets increased by $39.85 billion to $4.30 trillion, prime money market fund assets increased by $3.89 billion to $223.31 billion, and tax-exempt fund assets decreased by $48 million to $12.05 billion." Institutional assets accounted for 59.9% of all MMF assets, with Government Institutional assets making up 94.8% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have increased by $108.6 billion to a record $7.958 trillion month-to-date in November (as of 11/25). Assets increased by $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 in January. They jumped $110.9 billion in December, $200.5 billion last November. 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.
FDIC Says Deposits Inch Higher in Q3
A press release, entitled, "FDIC-Insured Institutions Reported Return on Assets of 1.27 Percent and Net Income of $79.3 Billion in Third Quarter 2025," comments, "The Federal Deposit Insurance Corporation (FDIC) ... released the results of its latest Quarterly Banking Profile, a comprehensive summary of financial results based on reports from 4,379 insured commercial banks and savings institutions. In the third quarter 2025, insured depository institutions reported a return on assets (ROA) ratio of 1.27 percent and aggregate net income of $79.3 billion, an increase of $9.4 billion (13.5 percent) from the prior quarter. Strong net interest income growth and a reduction in provision expense, primarily related to last quarter’s large bank acquisition, drove the quarterly increase in earnings." It says, "The industry reported a quarterly increase in net interest income (up $7.6 billion, or 4.2 percent), as interest income accelerated more than interest expense. The net interest margin (NIM) increased by 9 basis points to 3.34 percent, which is above the pre-pandemic average of 3.25 percent.1The community bank NIM of 3.73 percent increased 10 basis points from the prior quarter, increasing for the sixth consecutive quarter, and is above the pre-pandemic average of 3.63 percent." The release continues, "Domestic deposits increased $92.2 billion (0.5 percent) from second quarter 2025, rising for a fifth consecutive quarter. Estimated uninsured domestic deposits drove the increase, up $88.6 billion (1.1 percent) from the prior quarter." It adds, "The Deposit Insurance Fund Reserve Ratio Increased 4 Basis Points to 1.40 Percent: In the third quarter, the Deposit Insurance Fund balance increased $4.8 billion to $150.1 billion. The reserve ratio increased 4 basis points during the quarter to 1.40 percent.... The total number of FDIC-insured institutions declined by 42 during the third quarter to 4,379. During the quarter, four banks were sold to uninsured institutions and 38 institutions merged or consolidated with other banks."
Money Fund Yields Inch Down to 3.75%
Money fund yields (7-day, annualized, simple, net) decreased by 2 bps to 3.75% on average during the week ended Friday, November 21 (as measured by our Crane 100 Money Fund Index), after falling 3 bps the week prior and 10 bps two weeks prior. Fund yields should continue inching lower in coming days as they digest the remainder of the Fed's Oct. 29 25 bps rate cut (and then move lower again if we get a cut on Dec. 10). Yields were 3.90% on 10/31, 3.94% on 9/30, 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 679), shows a 7-day yield of 3.66%, down 2 bps in the week through Friday. Prime Inst money fund yields were down 1 bp at 3.86% in the latest week. Government Inst MFs were down 2 bps at 3.76%. Treasury Inst MFs were down 2 bps at 3.71%. Treasury Retail MFs currently yield 3.48%, Government Retail MFs yield 3.47% and Prime Retail MFs yield 3.66%, Tax-exempt MF 7-day yields were up 10 bps to 2.31%. Assets of money market funds rose by $12.1 billion last week to $7.911 trillion, according to Crane Data's Money Fund Intelligence Daily. MMF assets hit a record high of $7.931 trillion on November 13. Month-to-date in November (through 11/21), MMF assets have increased $61.0 billion, after increasing by $142.1 billion in October, $105.2 billion in September, $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 and $200.5 billion last November. Weighted average maturities were at 38 days for the Crane MFA and 40 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (11/21), 133 money funds (out of 790 total) yield under 3.0% with $159.5 billion in assets, or 2.0%; 644 funds yield between 3.00% and 3.99% ($7.617 trillion, or 96.3%), 13 funds yield between 4.0% and 4.99% ($134.1 billion, or 1.7%) 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 0.32%, after falling 1 basis point the week prior. The latest Brokerage Sweep Intelligence, with data as of November 21, shows no changes over the past week. Three of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley.
Paper on Bank Regs, SLR and MMFs
A recent acedemic paper, "Bank Regulation and Monetary Policy: the Role of Non-Bank Financial Institutions," written by Gara Afonso, Marco Cipriani, and Gabriele La Spada, explains, "Using a quasi-natural experiment, we show that quantitative easing (QE) interacts with bank regulation, impacting the size and portfolio choices of non-banks. In 2021, upon the expiration of the Supplementary Leverage Ratio relief, banks were incentivized to reduce leverage, shedding deposits and reducing the supply of wholesale debt. We show that as a result, money-market funds experienced large inflows and shifted their portfolios toward the Federal Reserve's ONRRP facility. Our results imply that when non-banks can access the central-bank balance sheet, they end up holding a share of central-bank liabilities, draining reserves and affecting the impact of QE through banks. In this paper, we use a quasi-natural experiment to show that quantitative easing (QE) interacts with bank regulation and, by increasing banks' balance-sheet costs, impacts both the size and portfolio choices of non-bank financial institutions." They tell us, "After the Global Financial Crisis (GFC), the Federal Reserve grew its balance sheet sharply to stimulate the economy through QE, increasing bank reserves, deposits, and lever age. Concurrently, US regulators implemented several reforms that penalize banks' balance sheet expansions; the goal of these regulations is to reduce bank risk-taking by curbing bank leverage. The most notable example of these rules is the Supplementary Leverage Ratio (SLR), which sets an explicit limit on the amount of leverage that large banks can take. This regulatory constraint makes balance-sheet expansions more costly for banks; moreover, since the SLR ratio is not risk-weighted, the cost is especially high for balance-sheet expansions associated with safe and low-margin activities, such as intermediation in the market for repurchase agreements (repos) collateralized by Treasuries." The piece says, "Several recent papers have highlighted the importance of banks' balance-sheet costs in explaining arbitrage deviations in asset prices and excess volatility in money-market rates. It is less clear, however, how the interaction of banks' balance-sheet costs with the central bank's balance-sheet policies affects non-bank financial institutions, their portfolio choices, and, in turn, the effectiveness of QE itself. An increase in balance-sheet costs incentivizes banks to reduce their debt. This can have two effects on non-bank financial institutions. First, banks could push their depositors into non-bank financial institutions that are seen as close substitutes to bank deposits, increasing the size of these non-banks. Second, banks could also borrow less in the wholesale market, including from non-banks, changing the portfolio composition of these non-banks. If non-banks have access to the central bank's balance sheet, they can accommodate the increase in size or change in investment opportunities by investing at the central bank." It adds, "In this paper, we identify these two effects by focusing on a key type of non-bank financial institution, money market funds (MMFs). We do this for two reasons. First, MMFs are both the main non-bank substitutes to bank deposits -- with $4.7 trillion in assets under management (AUM) at the end of December 2021 -- and the main providers of short-term wholesale liquidity to large banks; therefore, when banks' balance-sheet costs tighten, MMFs are the non-bank financial institutions more likely to be impacted. Second, MMFs can invest at the Federal Reserve through the ON RRP, a facility set up to support the implementation of monetary policy; MMFs are the main users of this facility, representing 82% of total usage on average between the facility inception in September 2013 and December 2021. As Figure 1 shows, investment in the ON RRP by MMFs increased dramatically between April 2021 and December 2021, accompanied by a reduction in MMF holdings of private overnight Treasury repos. Indeed, overall ON RRP take-up grew from a few billions at the beginning of April 2021 to $1.9 trillion at the end of December 2021, with 91% of the increase due to MMFs. To identify the impact of banks' balance-sheet costs on the size of the MMF industry, we compare MMFs affiliated with banks subject to the SLR regulation with other MMFs. The former should receive larger investor flows around the end of the relief, as their affiliated banks try to shed depositors to improve their SLR. The reason is twofold: banks have an incentive to keep their clients within the company, and investors have an incentive to stay within the same company to lower their switching costs. Consistent with this hypothesis, we find that in the two quarters around the end of the SLR relief, the AUM of MMFs affiliated with banks subject to the SLR increased more than the AUM of other MMFs by an average of $3.4 billion per fund, for a total of $364 billion."
The Investment Company Institute's latest weekly "Money Market Fund Assets" report shows money fund assets decreasing by $15.7 billion to $7.522 trillion after reaching a record high of $7.536 trillion the week prior. Assets have risen in 7 of the last 9 weeks, and 15 of the past 18 weeks. MMFs rose $2.7 billion last week, after increasing $116.4 billion two weeks ago. MMF assets are up by $873 billion, or 13.1%, over the past 52 weeks (through 11/19/25), with Institutional MMFs up $512 billion, or 12.9% and Retail MMFs up $362 billion, or 13.5%. Year-to-date, MMF assets are up by $671 billion, or 9.8%, with Institutional MMFs up $374 billion, or 9.1% and Retail MMFs up $297 billion, or 10.9%. ICI's weekly release says, "Total money market fund assets decreased by $15.74 billion to $7.52 trillion for the week ended Wednesday, November 19, the Investment Company Institute reported.... Among taxable money market funds, government funds decreased by $14.14 billion and prime funds decreased by $1.83 billion. Tax-exempt money market funds increased by $224 million." ICI's stats show Institutional MMFs decreasing $25.1 billion and Retail MMFs increasing $9.3 billion in the latest week. Total Government MMF assets, including Treasury funds, were $6.166 trillion (82.0% of all money funds), while Total Prime MMFs were $1.211 trillion (16.1%). Tax Exempt MMFs totaled $143.9 billion (1.9%). It explains, "Assets of retail money market funds increased by $9.34 billion to $3.03 trillion. Among retail funds, government money market fund assets increased by $7.86 billion to $1.91 trillion, prime money market fund assets increased by $1.15 billion to $991.94 billion, and tax-exempt fund assets increased by $331 million to $131.80 billion." Retail assets account for 40.3% of the total, and Government Retail assets make up 62.9% of all Retail MMFs. They add, "Assets of institutional money market funds decreased by $25.09 billion to $4.49 trillion. Among institutional funds, government money market fund assets decreased by $22.00 billion to $4.26 trillion, prime money market fund assets decreased by $2.98 billion to $219.42 billion, and tax-exempt fund assets decreased by $107 million to $12.10 billion." Institutional assets accounted for 59.7% of all MMF assets, with Government Institutional assets making up 94.8% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have increased by $50.4 billion to $7.900 trillion month-to-date in November (as of 11/19). They hit a record high of $7.931 trillion on November 13, but have dipped since. Assets increased by $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 in January. They jumped $110.9 billion in December, $200.5 billion last November. 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.
Inside Fidelity's Money Market Team
Fidelity Investments posted a video titled, "Inside Fidelity's Money Market Team," which features Portfolio Managers Joe McHale, Eric Graham and Stephanie Merrin. McHale says, "Hello and thank you for joining us to learn more about Fidelity's taxable money market investment team. As a leader in the money market industry, we pride ourselves on an investment process that's routed in a collaborative team-based approach that prioritizes safety, liquidity, and generating consistent returns. Our co-portfolio management structure, combined with our highly experienced trading, research, and technology teams, help us deliver on our investment strategy. Today I am pleased to introduce Eric Graham and Stephanie Merrin, who along with myself comprise the portfolio management team of our Government money market funds. We'll take some time today to discuss their career experiences and our team's investment approach. Eric, you joined the portfolio management team in March of 2024, but you've been with Fidelity since 2000 in a variety of roles. When you think about your career thus far at Fidelity, which experience do you feel has helped you the most for your current role?" Graham replies, "Thanks, Joe. I try not to assign any one experience as the most beneficial training ground for my current role as a portfolio manager, as I truly believe the benefit lies in the breadth of experience across roles in credit research, trading, and now portfolio management. Each functional role in our group is tasked with evaluating certain sets of risks the portfolios face. The portfolio manager is ultimately responsible for assessing all risk factors, which is why I believe having experience across the different disciplines prepares an individual well for the role." McHale comments, "Thanks Eric, and Stephanie, you joined Eric and I as a co-portfolio manager in January 2025. Can you tell us about your background prior to becoming a portfolio manager and what you think has prepared you most for this role?" Merritt answers, "Sure, Thanks Joe. I spent my early career working for banks. First for a bank treasury where I gained a deep understanding of balance sheet mechanics, liquidity management, and funding strategies. I then moved to sell-side rate sales, where I covered a variety of clients, including government-sponsored entities, banks, and money market funds. This role provided me with invaluable insights into the funding strategies and balance sheet management of the GSEs as well as the asset management practices of money market funds. Those two experiences helped me build a deep understanding of front-end markets across a range of different market participants. Equally important, before becoming a money market portfolio manager, I was a trader for our money market funds. That role allowed me to interact daily with portfolio managers and our portfolios, which gave me an in-depth understanding of our investment process and our shareholder needs." McHale then asks, "Can you talk a little bit about the money market teams investment approach?" Graham comments, "Paramount to our investment philosophy is insuring stability and liquidity for our shareholders while providing them with a competitive risk adjusted return. As you mentioned earlier, we work closely with our research, trading, and technology teams to help us achieve these goals. We collaborate with research to invest within the maturity day and dollar guideline limits aligned with their credit risk assessments across approved counterparties. Additionally, our research team performs in depth analysis on a Federal Reserve and U.S. Banking system, which informs our opinions on the trajectory of U.S. Monetary policy and the effects of its transmission on the banking system and money markets generally." Finally, Merritt adds, "Building off of Eric, we also partner with our Trading Desk, who helps us find opportunities to reinvest regular maturities. Depending on the portfolio, we invest in a combination of overnight investments and short duration government securities, which means we rely both on the government and repo trading desks to help us find the most advantageous investments. Finally, our technology partners provide us with the tools we need to monitor fund attributions, analyze investments, and stress test our funds to ensure ongoing stability and liquidity."
Weekly Money Fund Portfolio Holdings
Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of November 14) includes Holdings information from 62 money funds (up 15 from two weeks ago), or $4.029 trillion (up from $2.871 trillion) of the $7.899 trillion in total money fund assets (or 51.0%) 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 November 13 News, "Nov. Money Fund Portfolio Holdings: Treasuries Jump; Repo Inches Down.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.978 trillion (up from $1.409 trillion two weeks ago), or 49.1%; Repurchase Agreements (Repo) totaling $1.409 trillion (up from $965.7 billion two weeks ago), or 35.0%, and Government Agency securities totaling $353.9 billion (up from $286.5 billion two weeks ago), or 8.8%. Commercial Paper (CP) totaled $134.6 billion (up from $104.2 billion two weeks ago), or 3.3%. Certificates of Deposit (CDs) totaled $72.4 billion (up from $44.4 billion two weeks ago), or 1.8%. The Other category accounted for $42.2 billion or 1.0%, while VRDNs accounted for $38.2 billion or 1.0%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.978 trillion, Fixed Income Clearing Corp with $507.3B, the Federal Home Loan Bank with $207.6B, JP Morgan with $113.8B, RBC with $97.4B, BNP Paribas with $88.5B, Citi with $87.0B, Federal Farm Credit Bank with $85.6B, Wells Fargo with $73.5B and Barclays PLC with $63.6B. The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($316.9B), Goldman Sachs FS Govt ($282.9B), JPMorgan 100% US Treas MMkt ($280.2B), Fidelity Inv MM: Govt Port ($275.9B), State Street Inst US Govt ($191.8B), BlackRock Lq FedFund ($190.2B), Morgan Stanley Inst Liq Govt ($182.4B), Fidelity Inv MM: MM Port ($168.6B), BlackRock Lq Treas Tr ($168.5B) and Dreyfus Govt Cash Mgmt ($162.7B). (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 Dips to 3.77%
Money fund yields (7-day, annualized, simple, net) decreased by 3 bps to 3.77% on average during the week ended Friday, November 14 (as measured by our Crane 100 Money Fund Index), after falling 10 bps the week prior. Fund yields should continue moving lower in coming days as they digest the remainder of the Fed's Oct. 29 25 bps rate cut. Yields were 3.90% on 10/31, 3.94% on 9/30, 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 679), shows a 7-day yield of 3.68%, down 3 bps in the week through Friday. Prime Inst money fund yields were down 2 bps at 3.87% in the latest week. Government Inst MFs were down 4 bps at 3.78%. Treasury Inst MFs were down 2 bps at 3.73%. Treasury Retail MFs currently yield 3.50%, Government Retail MFs yield 3.49% and Prime Retail MFs yield 3.67%, Tax-exempt MF 7-day yields were down 26 bps to 2.21%. Assets of money market funds rose by $13.7 billion last week to $7.899 trillion, according to Crane Data's Money Fund Intelligence Daily. MMF assets hit a record high of $7.931 trillion on November 13. Month-to-date in November (through 11/14), MMF assets have increased $48.9 billion, after increasing by $142.1 billion in October, $105.2 billion in September, $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 and $200.5 billion last November. Weighted average maturities were at 39 days for the Crane MFA and 41 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (11/14), 126 money funds (out of 790 total) yield under 3.0% with $151.9 billion in assets, or 1.9%; 644 funds yield between 3.00% and 3.99% ($7.339 trillion, or 92.9%), 20 funds yield between 4.0% and 4.99% ($407.8 billion, or 5.2%) 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 down 1 bp to 0.32%, after falling 2 basis points the week prior. The latest Brokerage Sweep Intelligence, with data as of November 14, shows one change over the past week. Ameriprise Financial Services lowered rates for accounts of $1 to $249K to 0.05%, accounts of $250K to $499K to 0.10%, accounts of $500K to $999K to 0.15%, accounts of $1M to $4.9M to 1.19% and accounts of $5M or greater to 1.73%. Three of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley.
ICI Money Fund Holdings Summary
ICI also 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. It tells us, "The Investment Company Institute (ICI) reports that, as of the final Friday in October, prime money market funds held 47.0 percent of their portfolios in daily liquid assets and 60.8 percent in weekly liquid assets, while government money market funds held 76.6 percent of their portfolios in daily liquid assets and 87.9 percent in weekly liquid assets." Prime DLA was down from 47.2% in September, and Prime WLA was down from 60.8%. Govt MMFs' DLA rose from 75.9% and Govt WLA increased from 87.0% for the previous month. ICI explains, "At the end of October, prime funds had a weighted average maturity (WAM) of 32 days and a weighted average life (WAL) of 52 days. Average WAMs and WALs are asset-weighted. Government money market funds had a WAM of 43 days and a WAL of 94 days. "Prime WAMs and WALs were both 3 days longer from the previous month. Govt WAMs and WALs were both unchanged from the previous month. Regarding Holdings by Region of Issuer, the release tells us, "Prime money market funds' holdings attributable to the Americas declined from $740.43 billion in September to $736.56 billion in October. Government money market funds' holdings attributable to the Americas rose from $5,525.97 billion in September to $5,623.40 billion in October." The Prime Money Market Funds by Region of Issuer table shows Americas-related holdings at $736.6 billion, or 61.5%; Asia and Pacific at $154.6 billion, or 12.9%; Europe at $276.2 billion, or 23.1%; and, Other (including Supranational) at $30.5 billion, or 2.6%. The Government Money Market Funds by Region of Issuer table shows Americas at $5.623 trillion, or 91.7%; Asia and Pacific at $112.5 or 1.8%; Europe at $367.5 billion, 6.0%, and Other (Including Supranational) at $27.2 billion, or 0.4%.
Fidelity Investments latest "Money Market Monthly Commentary features a brief titled, "Not a Foregone Conclusion." Discussing the "Money Market Environment and Strategy Update," they write, "The market correctly anticipated the interest rate policy adjustment by the Fed at their October 28-29 policy meeting. `However, the market did not anticipate the continued growth of Treasury Bill supply that occurred throughout the month of October as the Treasury continues to utilize the product as a significant source of funding for the growing Federal deficits. Over the course of the past 4-months, net Treasury Bill supply has increased by over $800 billion which included a nearly $200 billion increase in Bill supply during October alone. This increase in Treasury supply resulted in a corresponding decrease of bank reserves and created attractive opportunities for our money market funds in both Treasury Bills as well as in the repurchase agreement market." Fidelity comments, "While the short-term investment opportunities were advantageous for our funds, the longer tenor opportunities became increasing challenging to evaluate given the lack of official economic data that the market received throughout the month. The longer the government shutdown lasts, the more difficult it becomes for market participants to identify the trends of the most important economic indicators such as labor and inflation which complicates the market's ability to anticipate the future reaction function by the FOMC in terms of monetary policy." They tell us, "While the majority of our funds did extend duration during October, our top priorities will always be to maintain price stability and provide liquidity to our shareholders. Therefore, during these times of heightened uncertainty, our conservative investment approach resulted in our funds remaining shorter than their respective peer groups. According to the Crane Data at the end of October, Government institutional funds had an average WAM of 39 days and an average WAL of 93 days while Government retail funds had an average WAM of 36 days and an average WAL of 87 days. Prime institutional funds ended the month with an average WAM of 30 days and an average WAL of 48 days while Prime retail funds had an average WAM of 34 days and an average WAL of 56 days." Fidelity's piece adds, "Fixed-rate CD/CP volumes were lower in October as compared to September as some of the precautionary funding taken up by issuers in the Spring continues to roll off. Despite the lower volumes over the past month, overall net supply remains higher year-to-date. Fixed-rate yields remain inverted as the three month yield decreased to 4.00-4.02% while the six-month yield declined to the 3.93-3.98% range. Volumes in the one-year tenor were light with quoted yields declining to 3.85-3.93%. All three tenors were lower in yield, reflecting the 25 bp reduction to the policy rate by the Fed at the end-October FOMC meeting. The spread for floating-rate securities relative to SOFR were largely unchanged with some signs of slight widening with the six-month tenor at SOFR +20-25 bp, the nine month tenor at SOFR +25-30 bp and the one-year tenor at SOFR +30-36 bp."
PFII Says LGIPs Nearly $1 Trillion
The Public Funds Investment Institute posted a brief titled, "2024 LGIP Survey: LGIPs Hold Nearly $1 Trillion of Public Funds." It explains, "This year we expanded our survey to include local sponsored LGIPs. In total we identified 161 portfolios. They operate in all but seven states. The survey is the only comprehensive look at the LGIP industry which invests assets for thousands of public units across the country." The update tells us, "Here are some highlights: LGIPs held $931 billion in state and local government assets at the end of last year. State sponsored programs dominate the industry with assets totaling $691 billion in 32 states. Average portfolio size was $14.7 billion in 47 portfolios." It continues, "Local sponsored LGIPs are smaller, with average size of $2.1 billion, but there are many more of them -- 114 portfolios in our survey. After several years of rapid growth, the path leveled in 2024, with assets of state-sponsored programs growing by 3% over 2023. (We did not survey local sponsored programs in 2023.)" The release says, "Most state sponsored portfolio assets are managed internally, but outside mangers are responsible for nearly 30% of assets. All local sponsored LGIPs have external managers. Stable value portfolios constituted more than 99% of LGIP assets. These seek to provide a constant net asset value just as money market mutual funds do. Some LGIPs also offer longer duration investment portfolios. While there were 28 of these offered, their assets totaled barely $15 billion." The piece adds, "LGIPs compete with money market funds whose assets totaled more than $7 trillion at the end of last year. LGIPs are not subject to most Securities and Exchange Commission rules, and they operate with greater flexibility than registered funds. State sponsored LGIPS operate at low expense ratios. They averaged 5.8 basis points last year, much lower than the average for institutional money market funds. Local sponsored LGIP expense ratios were appreciably higher, averaging 18.2 basis points." Finally, it says, "Disclosure and transparency among LGIPs vary from some whose disclosure follows SEC requirements for money market funds to others that provide little public disclosure of their shareholder and investment activities. The survey results provide state treasurers and trustees of LGIPs with details on how programs operate across the nation. They also provide investors with key information to help them evaluate and monitor LGIPs that they invest in. Download the LGIP Survey Report here"
Crane 100 MF Index Falls to 3.80%
Money fund yields (7-day, annualized, simple, net) decreased by 10 bps to 3.80% on average during the week ended Friday, November 7 (as measured by our Crane 100 Money Fund Index), after falling 2 bps the week prior. Fund yields should continue moving lower in coming days as they digest the remainder of the Fed's Oct. 29 25 bps cut. Yields were 3.90% on 10/31, 3.94% on 9/30, 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 679), shows a 7-day yield of 3.70%, down 9 bps in the week through Friday. Prime Inst money fund yields were down 14 bps at 3.89% in the latest week. Government Inst MFs were down 11 bps at 3.82%. Treasury Inst MFs were down 6 bps at 3.75%. Treasury Retail MFs currently yield 3.52%, Government Retail MFs yield 3.52% and Prime Retail MFs yield 3.70%, Tax-exempt MF 7-day yields were down 19 bps to 2.47%.`Assets of money market funds rose by $35.2 billion last week to $7.885 trillion <b:>`_, according to Crane Data's Money Fund Intelligence Daily. MMF assets hit a record high of $7.925 trillion on November 4. Month-to-date in November (through 11/7), MMF assets have increased $35.2 billion, after increasing by $142.1 billion in October, $105.2 billion in September, $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 and $200.5 billion last November. Weighted average maturities were at 39 days for the Crane MFA and 41 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (11/7), 121 money funds (out of 790 total) yield under 3.0% with $150.6 billion in assets, or 1.9%; 636 funds yield between 3.00% and 3.99% ($7.180 trillion, or 91.1%), 33 funds yield between 4.0% and 4.99% ($554.6 billion, or 7.0%) 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 down 2 bps to 0.33%, after falling 1 basis point the week prior. The latest Brokerage Sweep Intelligence, with data as of November 7, shows three changes over the past week. Ameriprise Financial Services lowered rates for accounts of $250K to $999K to 0.20% and accounts of $1M to $4.9M to 1.39%. Raymond James lowered rates for accounts of $1K to $249K to 0.05%, accounts of $250K to $499K to 0.10%, accounts of $500K to $999K to 0.12%, accounts of $1M to $4.9M to 1.15% and accounts of $10M or greater to 1.75%. RW Baird lowered rates for accounts of $1K to $999K to 1.05%, accounts of $1M to $1.9M to 1.69% and accounts of $5M or greater to 2.22%. Three of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley.
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