Money Fund Yields Dip Lower to 4.45%
Money fund yields declined by 3 basis points to 4.45% on average during the week ended Friday, Nov. 22 (as measured by our Crane 100 Money Fund Index), after falling 9 bps the week prior. Yields are now reflecting the majority of the Federal Reserve's 25 basis point cut on November 7, but they should continue inching lower this week and next. They've declined by 61 bps since the Fed cut its Fed funds target rate by 50 bps percent on Sept. 18 and they've declined by 18 bps since the Fed cut rates by 1/4 point on 11/7. Yields were 4.65% on average on 10/31, 4.75% on 9/30, 5.10% on 8/31, 5.13% on 7/31 and 6/28, 5.14% on 5/31, 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, and 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 672), shows a 7-day yield of 4.36%, down 3 bps in the week through Friday. Prime Inst money fund yields were down 3 bps at 4.56% in the latest week. Government Inst MFs were down 4 bps at 4.46%. Treasury Inst MFs were down 3 bps at 4.42%. Treasury Retail MFs currently yield 4.20%, Government Retail MFs yield 4.16%, and Prime Retail MFs yield 4.34%, Tax-exempt MF 7-day yields were up 2 bps to 2.86%. Assets of money market funds rose by $11.2 billion last week to $6.993 trillion, they reached a record high on Wednesday, November 13 of $7.010 trillion but assets have declined since, according to Crane Data's Money Fund Intelligence Daily. For the month of November, MMF assets have increased by $130.4 billion, after increasing by $97.5 billion in October and $149.8 billion in September. Weighted average maturities were unchanged at 36 days for the Crane MFA and unchanged at 37 days for the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (11/22), 75 money funds (out of 786 total) yield under 3.0% with $50.0 billion in assets, or 0.7%; 106 funds yield between 3.00% and 3.99% ($139.0 billion, or 2.0%), 605 funds yield between 4.0% and 4.99% ($6.804 trillion, or 97.3%) and following the recent rate cut there continues 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 0.46%, after dropping 2 basis points the week prior. The latest Brokerage Sweep Intelligence, with data as of Nov. 22, shows that there was one change over the past week. Merrill Lynch lowered rates once again for their advisory accounts, now at 4.48% (down 5 bps from the week prior). 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.
