Fitch Ratings published its "U.​S. Money Market Fund Dashboard: March 2020," which is subtitled, "Government Responds to Liquidity Strains; Risks Remain Elevated." They explain, "U.​S. prime money market fund (​MMF) flows turned negative in February 2020, driven by investors' increasing risk aversion due to the coronavirus pandemic. Prime MMF assets were down $​145 billion between Feb. 20 and March 24, 2020, after rising $​432 billion between Nov. 1, 2016 and Feb. 20, 2020, according to iMoneyNet." Fitch writes, "Until the recent support mechanisms introduced by the Federal Reserve, outflows from prime MMFs had challenged fund managers’ ability to manage liquidity. Funds are utilizing the Fed’​s new Money Market Liquidity Facility (​MMLF) to sell longer-​dated assets to meet redemptions, while maintaining their weekly liquidity above regulatory thresholds." They add, "While the Fed facilities were crucial in maintaining liquidity and stability in the prime MMF space, Fitch Ratings revised its sector outlook to negative from stable on March 23. This revision reflects continued investor risk aversion and unprecedented market volatility, combined with increased credit risks facing banks and corporate entities, which could pressure the funds' underlying investment portfolios."

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