Average Yields Poised to Break 5.0%
Money fund yields inched up by just one basis point over the past week, but we expect them to jump late this week (following the FOMC's meeting on Wednesday). Our Crane 100 Money Fund Index (7-Day Yield) was up 1 bp to 4.96% in the week ended Friday, 7/21, after also increasing by 1 bp the week prior. Yields are up from 4.90% on May 31, 4.64% on April 30, 4.61% on March 31, 4.39% on Feb. 28, 4.15% on Jan. 31 and 4.05% on 12/31/22. They've increased from 3.59% on Nov. 30, from 2.88% on Oct. 31 and from 2.66% on Sept. 30. Over half of money market fund assets now yield above the 5.0% level. Assets of money market funds rose by $35.5 billion last week to $5.876 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were flat on the week at 23 days (Crane 100), but they rose by 3 days during June. The Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 682), shows a 7-day yield of 4.86%, up 2 bps in the week through Friday. Prime Inst MFs were up 4 bps at 5.05% in the latest week. Government Inst MFs were up 1 bp at 4.92%. Treasury Inst MFs up 2 bps for the week at 4.92%. Treasury Retail MFs currently yield 4.70%, Government Retail MFs yield 4.62%, and Prime Retail MFs yield 4.88%, Tax-exempt MF 7-day yields were up 14 bps at 2.40%. According to Monday's Money Fund Intelligence Daily, with data as of Friday (7/21), 11 money funds (out of 811 total) yield under 2.0%; 117 funds yield between 2.00% and 2.99% with $115.5 billion, or 2.0%; 6 funds yield between 3.00% and 3.99% ($4.2 billion, or 0.1%), 418 funds yield between 4.0% and 4.99% ($2.090 trillion, or 35.6%) and 259 funds now yield 5.0% or more ($3.666 trillion, or 62.4%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.59% after rising 3 bps ten weeks ago. The latest Brokerage Sweep Intelligence, with data as of July 21, shows that there was no changes over the past week. Three of the 11 major brokerages tracked by our BSI still offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley.
