Money market mutual fund assets fell by $114.87 billion, or 3.4%, in September, the 8th consecutive monthly drop and the largest decline since September 2008's $160.07 billion decrease, according to Crane Data's monthly Money Fund Intelligence. September's outflows follow declines of $49.60 billion in August, $56.03 billion in July, and $83.60 billion in June.
Money fund assets have declined by $439.16 billion, or 11.9%, since the end of January of this year. This precipitous drop follows a huge $486.44 billion, or 15.2%, increase that money funds experienced from October 2008 through January 2009 -- the four months immediately following Reserve Primary Fund's "breaking of the buck."
At $3.25 trillion, money fund assets remain $47.28 billion higher than they were on Sept. 30, 2008, and $580.12 billion, or 21.7%, higher than they were on Sept. 30, 2007. Both Retail and Institutional funds showed declines in September, but Institutional funds remain up sharply over 12 months (+15.9%) while Retail funds show significant declined (-13.2%). (These statistics are from Crane Data's monthly asset series, which is slightly lower than the ICI's more comprehensive collection. See today's "Link of the Day" for ICI's latest weekly totals.)
Money fund yields appear to be bottoming, but some averages continue to set new record lows. Our broadest benchmark for Taxable money funds, the Crane Money Fund Average, remained unchanged at 0.06% (annualized 7-day yield as of Sept. 30) at month-end. The Crane 100, which we believe better reflects what investors actually earn given its bias towards the largest funds, inched lower to 0.11%. One year ago, the Crane Money Fund Average yielded 1.69% and two years ago it yielded 4.61%. The Crane 100 was 2.17% as of Sept. 30, 2008, and 5.01% as of Sept. 30, 2007.
Crane Data collected statistics on 1,325 money market funds in September, down from 1,343 a year ago and up from 1,189 two years ago. The Average Maturity for our Crane Money Fund Average declined by one day in September to 46 days, but the AM remained at 51 days for the Crane 100 Index. (Note: Subscribers to Money Fund Intelligence may request a copy of our historical asset totals and Crane Indexes by writing pete@cranedata.us <i:mailto: pete@cranedata.us. Non-subscribers may also write to request the most recent issue of `Crane Index or MFI.)
In other news, the commercial paper market has been showning a nice little rebound, according to recent Federal Reserve statistics. Total outstandings (seasonally adjusted) have increased by over $100 billion in the past month and have almost regained the $1.3 trillion level. (See The Wall Street Journal's negative spin, "Commercial Paper Isn't As Healthy As It Seems", and Bloomberg's earlier "Commercial Paper Market Expands Most in Almost a Year".)
