Reuters on ECB Cut and MMFs
Concerning the ECB deposit cut into negative territory's impact on money market funds, a Reuters article, "Euro holds ground", says, "Morgan Stanley analysts reckon the imposition of negative rates could lead to an exodus from euro zone money markets. They expect U.S. money market funds, who have holdings of around 350 billion euros in the euro zone, to liquidate some of their holdings, putting downward pressure on the euro." In other news, the ICI's latest "Money Market Fund Assets" release says, "Total money market fund assets decreased by $7.25 billion to $2.58 trillion for the week ended Wednesday, June 4, the Investment Company Institute reported today. Among taxable money market funds, treasury funds (including agency and repo) decreased by $5.91 billion and prime funds decreased by $3.71 billion. Tax-exempt money market funds increased by $2.38 billion. Assets of retail money market funds increased by $40 million to $903.30 billion. Treasury money market fund assets decreased by $810 million to $200.77 billion, prime money market fund assets decreased by $170 million to $515.34 billion, and tax-exempt fund assets increased by $950 million to $187.19 billion. Assets of institutional money market funds decreased by $7.21 billion to $1.68 trillion. Among institutional funds, Treasury money market fund assets decreased by $5.10 billion to $714.12 billion, prime money market fund assets decreased by $3.54 billion to $890.45 billion, and tax-exempt fund assets increased by $1.43 billion to $72.06 billion."
