ICI released its December 2012 asset flow and portfolio composition data yesterday, which verified that money fund assets and CD and government agency holdings surged in December while repo holdings took their traditional quarter-end plunge. (See Crane Data's Jan. 14 news on the continued surge in repos, "December Money Fund Portfolio Holdings Show Everything Up But Repo.") Money fund assets rose in the first week of January, but the November and December surge stalled out after the second week of the month; assets will likely show just minor increases in January, according to Crane Data's MFI Daily. We show an increase of just $7.6 billion month-to-date; assets rose by $31.1 billion from Dec. 31 through Jan. 11, then they fell by $23.5 billion from Jan. 11 through Jan. 29. ICI's "Trends in Mutual Fund Investing: December 2012" shows that money market mutual fund assets jumped by $75.9 billion last month (after rising $68.6 billion in November). ICI's "Month-End Portfolio Holdings of Taxable Money Market Funds show Repurchase Agreements plunging in December (after surging in Oct. and Nov.) while CD and Agency holdings jumped sharply.

ICI's December "Trends" says, "The combined assets of the nation's mutual funds increased by $174.3 billion, or 1.4 percent, to $13.047 trillion in December, according to the Investment Company Institute's official survey of the mutual fund industry. In the survey, mutual fund companies report actual assets, sales, and redemptions to ICI..... Bond funds had an inflow of $7.42 billion in December, compared with an inflow of $23.73 billion in November.... Money market funds had an inflow of $75.63 billion in December, compared with an inflow of $68.34 billion in November. Funds offered primarily to institutions had an inflow of $36.70 billion. Funds offered primarily to individuals had an inflow of $38.93 billion."

MTD through January 29, assets have increased by $7.6 billion, according to Crane Data's Money Fund Intelligence Daily, though assets leapt through Jan. 11 (up $31.1 billion) but then plummeted the rest of the month (down $23.5 billion). Retail (taxable) assets fell sharply in January (down $14.8 billion) after a buildup of $44.2 billion in November and December. Institutional (taxable) assets continued increasing in January (up $24.4 billion), after a surge of $90.1 billion in Nov. and Dec.

Prime Institutional assets rose by $23.0 billion in January and by $40.9 billion from 10/31/12 through 12/31/12. Treasury Institutional assets rose by $6.9 billion in Jan. and by $19.9 billion in Nov. and Dec. While these flows show clear signs that the year-end expiration of the "TAG" unlimited FDIC insurance program shifted assets into money funds, it appears that other factors, such as fears of the fiscal cliff and perhaps even Hurricane Sandy, were at work.

ICI's Portfolio Holdings for December 2012 show Repurchase Agreements falling sharply. Repos hit a record level in November, but fell by $76.3 billion in December to $553.6 billion (23.0% of assets). They remained the largest holding in taxable money funds though. Holdings of Certificates of Deposits moved into the second largest position with a surge in December, rising $54.2 billion to $481.1 billion (20.0%). Treasury Bills & Securities dropped to the third largest segment at 19.5%, though holdings in T-Bills and other Treasuries rose by $11.8 billion to $469.6 billion.

Commercial Paper fell to the fifth largest spot behind U.S. Government Agency Securities; CP rose by $15.4 billion to $346.7 billion (14.4% of assets) but Agencies rose by $36.8 billion to $347.3 billion (14.4% of taxable assets). Notes (including Corporate and Bank) rose by $10.7 billion to $104.8 billion (4.4% of assets), and Other holdings accounted for 3.5% ($85.3 billion).

The Number of Accounts Outstanding in ICI's Holdings series for taxable money funds increased by 73,954 to 25.119 million, while the Number of Funds fell by 5 to 400. The Average Maturity of Portfolios shortened by 5 days to 45 days in December. Since December 2011, WAMs of Taxable money funds have lengthened by 3 days. (Note that the archived version of our Money Fund Intelligence XLS monthly spreadsheet -- see our Content Page to download -- now has Portfolio Composition and Maturity Distribution totals updated as of Dec. 31, 2012. We revise these following the monthly publication of our final Money Fund Portfolio Holdings data.)

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