Money market mutual fund yields declined slightly in May, though their 9-month long decline appears to be at an end. Our broadest benchmark Crane Money Fund Average fell slightly from 2.08% to 2.03% (7-day current annualized yields as of month-end), while the heavily "prime" fund weighted Crane 100 Money Fund Index, a measure of the 100 largest money fund, fell harder, from 2.47% to 2.35%. The Crane Tax Exempt Money Fund Index plummeted from 2.05% to 1.36%.
Treasury fund yields rebounded while Government and Prime fund yields declined in May. The Crane Treasury Institutional Money Fund Index rose from 1.61% to 1.78%, and the Crane Treasury Individual MF Index rose from 1.19% to 1.32%. The Crane Government Institutional Index drifted lower, from 2.22% to 2.19%, and the Crane Govt Individual Index moved from 1.85% to 1.80%. The larger Crane Prime Insitutional Money Fund Index fell from 2.75% to 2.59%, and the Crane Prime Individual Index fell from 2.29% to 2.15%. Brokerage and bank rates declined slight in May too.
Assets of money market mutual funds rebounded in May, following tax-related April outflows. ICI's weekly series show money funds gaining approximately $87 billion in May to break back above the $3.5 trillion level. Institutional funds led the advance, adding about $96 billlion, while Retail funds declined by almost $10 billion. Individuals continued seeing some tax outflows in May (it takes weeks for the IRS to clear checks), though some investors undoubtedly returned to bond and equity markets as concerns ease over markets and the economy.
See the pending June issue of Money Fund Intelligence and Crane Index for more details.
