Prime Outflows Top $430 Billion
ICI's weekly "Money Market Fund Assets" report shows that overall MMF assets declined in the latest week as Prime assets fell sharply. ICI's release says, "Total money market fund assets decreased by $17.41 billion to $2.70 trillion for the week ended Wednesday, July 6, the Investment Company Institute reported today. Among taxable money market funds, government funds increased by $3.27 billion and prime funds decreased by $23.17 billion. Tax-exempt money market funds increased by $2.48 billion." Government assets, including Institutional and Retail (and Treasury and Government), stand at $1.479 trillion, while Prime assets are at $1.026 trillion. Government fund assets moved ahead of Prime assets earlier this year, fueled by the conversion (or liquidation) of over $300 billion of Prime funds to Govt funds. The release explains, "Assets of retail money market funds increased by $2.42 billion to $956.44 billion. Among retail funds, government money market fund assets increased by $2.32 billion to $442.08 billion, prime money market fund assets decreased by $680 million to $363.77 billion, and tax-exempt fund assets increased by $780 million to $150.58 billion. Assets of institutional money market funds decreased by $19.83 billion to $1.74 trillion. Among institutional funds, government money market fund assets increased by $950 million to $1.04 trillion, prime money market fund assets decreased by $22.49 billion to $662.21 billion, and tax-exempt fund assets increased by $1.71 billion to $45.44 billion." ICI notes, "In anticipation of the Securities and Exchange Commission's (SEC) new money market fund regulations, many advisers are changing their prime money market funds into government money market funds. As a result, there have been, and will continue to be, large shifts in assets from prime funds to government funds before the October 2016 deadline." Year-to-date through July 6, money fund assets are down $58 billion, with Institutional assets down $76 billion and Retail assets up $17 billion. Prime MMF assets have declined by $257.8 billion YTD (-20.1%) and have declined by $432.4 billion (-29.6%) since 10/31/15 (when the first of the large Prime-to-Govie conversions began. Government MMFs assets have increased by $257.9B (21.1%) YTD and have increased by $465.1B (45.9%) since 10/31.
