The Investment Company Institute released its latest monthly "Trends in Mutual Fund Investing" and "Month-End Portfolio Holdings of Taxable Money Funds" for August 2021 on Wednesday. The monthly "Trends" report shows that money fund assets increased $25.5 billion in August to $4.535 trillion. This follows a decreased $24.4 billion in July, a decrease of $73.4 billion in June, and increases of $78.6 billion in May, $31.9 billion in April, $129.4 billion in March and $39.4 billion in February. MMFs decreased $5.2 billion in January, $10.0 billion in December and $12.0 billion in November, and assets also fell $47.6 billion in October and $118.4 billion in September. For the 12 months through August 31, 2021, money fund assets have increased by $12.6 billion, or 0.3%. (Month-to-date in September through 9/28, MMF assets have increased by $5.4 billion according to Crane's MFI Daily.)

Their monthly release states, "The combined assets of the nation’s mutual funds increased by $435.37 billion, or 1.7 percent, to $26.60 trillion in August, according to the Investment Company Institute's official survey of the mutual fund industry. In the survey, mutual fund companies report actual assets, sales, and redemptions to ICI.... Bond funds had an inflow of $34.26 billion in August, compared with an inflow of $16.04 billion in July.... Money market funds had an inflow of $25.40 billion in August, compared with an outflow of $24.42 billion in July. In August funds offered primarily to institutions had an inflow of $18.00 billion and funds offered primarily to individuals had an inflow of $7.41 billion."

The Institute's latest statistics show that both Taxable funds saw gains while Tax Exempt MMFs saw declines last month. Taxable MMFs increased by $26.1 billion in August to $4.445 trillion. Tax-Exempt MMFs decreased $0.5 billion to $90.7 billion. Taxable MMF assets increased year-over-year by $42.3 billion (1.0%), while Tax-Exempt funds fell by $29.6 billion over the past year (-24.6%). Bond fund assets increased by $31.3 billion in August to a record $5.605 trillion; they've risen by $668.9 billion (13.6%) over the past year.

Money funds represent 17.1% of all mutual fund assets (down 0.1% from the previous month), while bond funds account for 21.1%, according to ICI. The total number of money market funds was 307, down 7 from the prior month and down from 352 a year ago. Taxable money funds numbered 247 funds, and tax-exempt money funds numbered 60 funds.

ICI's "Month-End Portfolio Holdings" confirms yet another plunge in Treasuries and another surge in Repo last month. Treasury holdings in Taxable money funds still remain (but barely) the largest composition segment (since surpassing Repo last April). Treasury holdings plunged $95.8 billion, or -5.0%, to $1.824 trillion, or 41.0% of holdings. Treasury securities have decreased by $457.5 trillion, or -20.1%, over the past 12 months. (See our Sept. 13 News, "Sept. MF Portfolio Holdings: Repos Tie T-Bills as Largest MF Segment.")

Repurchase Agreements were the second largest composition segment; repos jumped by $162.5 billion, or 9.9%, to $1.800 trillion, or 40.5% of holdings. Repo holdings have increased $806.5 billion, or 81.2%, over the past year. U.S. Government Agency securities were the third largest segment; they decreased $14.5 billion, or -3.0%, to $475.4 billion, or 10.7% of holdings. Agency holdings have fallen by $270.1 billion, or -36.2%, over the past 12 months.

Certificates of Deposit (CDs) remained in fourth place; they decreased by $7.9 billion, or -4.2%, to $178.2 billion (4.0% of assets). CDs held by money funds shrank by $34.7 billion, or -16.3%, over 12 months. Commercial Paper took fifth place, up $3.4 billion, or 2.3%, to $154.1 billion (3.5% of assets). CP has decreased by $33.5 billion, or -17.8%, over one year. Other holdings decreased to $23.7 billion (0.5% of assets), while Notes (including Corporate and Bank) were up to $4.0 billion (0.1% of assets).

The Number of Accounts Outstanding in ICI's series for taxable money funds increased to 45.623 million, while the Number of Funds was down 3 to 247. Over the past 12 months, the number of accounts rose by 5.938 million and the number of funds decreased by 25. The Average Maturity of Portfolios was 37 days, down one day from July. Over the past 12 months, WAMs of Taxable money have decreased by 6.

In other news, another recent release from ICI tells us that, "Retirement Assets Total $37.2 Trillion in Second Quarter 2021." It includes data tables showing that money market funds held in retirement accounts fell to $536 billion in total, or 12% of the total $4.534 trillion in money funds. MMFs represent 4.4% of the total $12.123 trillion of mutual funds in retirement accounts.

The release says, "` Total US retirement assets were $37.2 trillion as of June 30, 2021, up 4.8 percent from March 31, 2021. Retirement assets accounted for 33 percent of all household financial assets in the United States at the end of June 2021. Assets in individual retirement accounts (IRAs) totaled $13.2 trillion at the end of the second quarter of 2021, an increase of 5.4 percent from the end of the first quarter of 2021. Defined contribution (DC) plan assets were $10.4 trillion at the end of the second quarter, up 5.3 percent from March 31, 2021. Government defined benefit (DB) plans— including federal, state, and local government plans—held $7.5 trillion in assets as of the end of June 2021, a 4.0 percent increase from the end of March 2021. Private-sector DB plans held $3.5 trillion in assets at the end of the second quarter of 2021, and annuity reserves outside of retirement accounts accounted for another $2.5 trillion."

The ICI tables also show money funds accounting for $368 billion, or 6%, of the $5.967 trillion in IRA mutual fund assets and $113 billion, or 2%, of the $4.815 trillion in 401(k) plan holdings.

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