After a 5-week pause in outflows, money market mutual fund assets again took a turn downward in the latest week, though the large size of the drop was likely due to a Dec. 15 tax-payment date. The mutual fund industry's trade group, the Investment Company Institute, said last night, "Total money market mutual fund assets decreased by $51.13 billion to $3.269 trillion for the week ended Wednesday, December 16." Year-to-date, money fund assets have declined by $561 billion, or 14.6%.

ICI's weekly release continues, "Taxable government funds decreased by $17.36 billion, taxable non-government funds decreased by $29.15 billion, and tax-exempt funds decreased by $4.63 billion.... Assets of retail money market funds decreased by $3.76 billion to $1.073 trillion. Taxable government money market fund assets in the retail category decreased by $520 million to $165.85 billion, taxable non-government money market fund assets decreased by $2.59 billion to $671.51 billion, and tax-exempt fund assets decreased by $650 million to $235.72 billion."

It adds, "Assets of institutional money market funds decreased by $47.37 billion to $2.196 trillion. Among institutional funds, taxable government money market fund assets decreased by $16.84 billion to $855.88 billion, taxable non-government money market fund assets decreased by $26.56 billion to $1.176 trillion, and tax-exempt fund assets decreased by $3.97 billion to $164.65 billion."

This latest weekly decline caused institutional assets to surpass retail assets for the biggest year-to-date declines in dollar terms (down $290 billion vs. $282 billion), but retail assets continue to show much larger percentage declines (down 20.8% vs. 11.6% for inst). Money fund assets have now declined to levels not seen since mid-January 2008, though they still remain $1 trillion higher than their level of November 2006.

Year-to-date through Wednesday, Crane Data's Money Fund Intelligence Daily, which tracks a smaller universe than ICI and which has been adding funds (and thus inflating assets slightly) throughout the year, shows an overall asset decline of $454 billion (12.8%). Treasury Institutional funds show the sharpest dollar declines (down $188 billion, or 36.9%), followed by Prime Retail funds (down $108 billion, or 14.1%), Tax Exempt funds (down $85 billion, or 18.0%), Government Institutional money funds (down $85 billion, or 14.4%), Government Retail funds (down $62 billion), and Treasury Retail (down $61 billion, or 41.3%). Prime Institutional funds are the only category to show an increase, $133 billion, or 14.7%, YTD.

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