Treasury MMFs Tumble in Week
Money market mutual fund assets decreased for the second straight week, according to ICI's latest "Money Market Mutual Fund Assets" report. The drop was almost entirely among Treasury money funds, which mystified market watchers awaiting moves into the sector. It says, "Total money market fund assets decreased by $15.57 billion to $2.66 trillion for the week ended Wednesday, September 9, the Investment Company Institute reported today. Among taxable money market funds, Treasury funds (including agency and repo) decreased by $11.87 billion and prime funds decreased by $2.94 billion. Tax-exempt money market funds decreased by $760 million. Assets of retail money market funds increased by $2.39 billion to $896.80 billion. Among retail funds, Treasury money market fund assets increased by $1.21 billion to $204.08 billion, prime money market fund assets increased by $1.19 billion to $511.48 billion, and tax-exempt fund assets decreased by $10 million to $181.24 billion. Assets of institutional money market funds decreased by $17.96 billion to $1.77 trillion. Among institutional funds, Treasury money market fund assets decreased by $13.07 billion to $774.97 billion, prime money market fund assets decreased by $4.13 billion to $923.12 billion, and tax-exempt fund assets decreased by $760 million to $67.72 billion." Year-to-date, money fund assets are down $71 billion, or 2.6%. We're not clear what caused the steep drop in Treasury fund assets, but we'd guess some kind of huge merger or bond deal (see Wednesday's WSJ piece, "Corporate Borrowers Log a Banner Day"), or perhaps a big move of funds by China or a large government, might account for it. Among funds, our Money Fund Intelligence Daily shows that BofA Treasury Reserves Capital saw assets decline a massive $11.5 billion over the week, while Goldman Sachs FS Trs Ins Adm, Goldman Sachs FS Govt Admin, and Morgan Stanley Inst Liq Govt Inst all saw assets decline by over $5.0 billion.
