MMF Assets Plunge on Tax Outflows
Money market fund assets dropped sharply, breaking below $2.6 trillion for the first time since Sept. 2014, according to ICI in its latest weekly "Money Market Mutual Fund Assets" report. The release says, "Total money market fund assets decreased by $39.34 billion to $2.59 trillion for the week ended Wednesday, April 15, the Investment Company Institute reported today. Among taxable money market funds, Treasury funds (including agency and repo) decreased by $6.54 billion and prime funds decreased by $27.25 billion. Tax-exempt money market funds decreased by $5.55 billion. Assets of retail money market funds decreased by $7.52 billion to $875.61 billion. Among retail funds, Treasury money market fund assets decreased by $1.37 billion to $192.57 billion, prime money market fund assets decreased by $3.59 billion to $496.95 billion, and tax-exempt fund assets decreased by $2.56 billion to $186.09 billion. Assets of institutional money market funds decreased by $31.82 billion to $1.72 trillion. Among institutional funds, Treasury money market fund assets decreased by $5.17 billion to $752.59 billion, prime money market fund assets decreased by $23.66 billion to $898.61 billion, and tax-exempt fund assets decreased by $2.99 billion to $67.11 billion." Year-to-date, money fund assets are down $139 billion, or 5.1%. In other news, Bloomberg reports, "Safest U.S. Debt Likely Only Collateral Covered in Repo Clearing." It says, "Treasuries and U.S. government-related bonds are likely be the only collateral covered when financial institutions begin offering centralized trade clearing in the short-term market for borrowing and lending debt. The securities account for about 85 percent of the almost $1.7 trillion financed daily in the repurchase-agreement market, where banks typically borrow cash for a short time from investors, such as money-market mutual funds, using securities as collateral."
