Money market fund assets were down sharply this week, says ICI in its latest weekly "Money Market Mutual Fund Assets" report. The release says, "Total money market fund assets decreased by $47.23 billion to $2.63 trillion for the week ended Wednesday, April 1, the Investment Company Institute reported today. Among taxable money market funds, Treasury funds (including agency and repo) decreased by $19.02 billion and prime funds decreased by $27.06 billion. Tax-exempt money market funds decreased by $1.16 billion. Assets of retail money market funds decreased by $2.63 billion to $882.11 billion. Among retail funds, Treasury money market fund assets decreased by $1.26 billion to $193.02 billion, prime money market fund assets decreased by $380 million to $501.59 billion, and tax-exempt fund assets decreased by $990 million to $187.50 billion. Assets of institutional money market funds decreased by $44.61 billion to $1.75 trillion. Among institutional funds, Treasury money market fund assets decreased by $17.76 billion to $769.70 billion, prime money market fund assets decreased by $26.67 billion to $911.62 billion, and tax-exempt fund assets decreased by $170 million to $70.45 billion." This was the largest decline in over a year, since the week ended Feb. 19, 2014. Year-to-date through April 1, assets are down $99 billion, or 3.6%. In other news, Reuters writes "More Permanent Role Seen for Fed's Repurchase Program". The article says, "A pledge by the U.S. Federal Reserve to phase out a new tool to lift interest rates is being challenged by economists and financial professionals who think the central bank may need to keep using it longer than Fed officials expect. As the Fed approaches an interest rate hike -- expected later this year -- it will use a suite of tools, including an overnight reverse repurchase facility (ON RRP) for money market funds to help lift its traditional federal funds rate from near zero. The notion of making the repurchase program a more permanent fixture at the Fed reflects the increasing role that non-bank lenders, also known as shadow banks, are playing in the U.S. borrowing market.... The Fed has said it will shutter the repo program as soon as it's no longer needed, with Atlanta Fed President Dennis Lockhart saying on Wednesday that the central bank can adjust rates in a way to where the program "dies under its own weight." Boston Fed Vice President Joe Peek said the central bank may have to make its new tools for controlling rates a permanent feature of monetary policy."

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