Daily Links Archives: May, 2024

Barron's writes, "Treasury Bills Are the Best Place to Park Your Cash. Just Ask Warren Buffett." They explain, "Investors large and small are gravitating to Treasury bills, thanks to yields of 5.4%, tax benefits, and sleep-at-night security -- and there's no reason for them to stop. For a while now, Treasuries with maturities of a year or less, known as T-bills, have offered more yield than other U.S. debt offerings. That's due to the so-called inverted yield curve, with short rates higher than long ones. The 10-year Treasury, for instance, yields 4.45%, while the three-month yields 5.39%. Bills have also offered positive returns -- about 2% this year, based on popular exchange-traded funds -- while long-term Treasuries are in the red." The piece continues, "Berkshire Hathaway CEO Warren Buffett is a leading proponent of short-term Treasuries. Berkshire is one of the largest T-bill investors in the world, holding $153 billion at the end of the first quarter, the bulk of its $182 billion in cash and equivalents. At Berkshire's annual meeting, Buffett called T-bills 'the safest investment there is,' saying he takes no chances with Berkshire's cash. Buffett has long favored T-bills with Berkshire's cash, even when they yielded close to zero from 2020 through 2022. Individual investors have been following Buffett's lead. Retail demand has been strong at the Treasury's regular auctions of T-bills, of which there are $6 trillion outstanding." Barron's says, "T-bills aren't the only place to earn a nice yield on cash. Investors also have access to certificates of deposit, money-market funds, and high-yield savings accounts. But bills are superior in many respects to those alternatives. For one, T-bills yield more, with online savings accounts offering interest rates of 4.4% and Marcus, a leading online bank, offering a six-month CD at 5.1%. Bills have a tax advantage, too. Their interest is exempt from state and local taxes -- a nice plus in high-tax states like New York and California, where marginal income-tax rates can top 10%. Interest on bank accounts and most money funds is subject to state and local taxes. Even investors holding government money funds can be hit with these taxes because they often hold repurchase agreements -- short-term loans backed by government securities -- and not Treasuries." It adds, "ETFs focused on Treasury bills are also a popular option. They simplify ownership, offer easy liquidity, and pay monthly income. The two largest ETFs are the $32.6 billion SPDR Bloomberg 1-3 Month T-Bill (BIL) and the $21 billion iShares 0-3 Month Treasury Bond (SGOV). Both yield about 5.25% and have little rate risk, given average maturities on their portfolios of about a month. Buffett favors three-month and six-month T-bills.... In addition to the SPDR Bloomberg 1-3 Month and iShares 0-3 Month ETFs, there are the $18.8 billion iShares Short Treasury Bond (SHV) and the $5.3 billion Goldman Sachs Access Treasury 0-1 Year (GBIL). Many financial advisors use these ETFs as an alternative to money-market funds for their tax benefits."

Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of May 24) includes Holdings information from 75 money funds (up 7 from a week ago), or $3.366 trillion (up from $3.103 trillion) of the $6.434 trillion in total money fund assets (or 52.3%) tracked by Crane Data. (Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our May 10 News, "May Money Fund Portfolio Holdings: Repo Jumps to No. 1, T-Bills Plunge.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.472 trillion (up from $1.387 trillion a week ago), or 43.7%; Repurchase Agreements (Repo) totaling $1.266 trillion (up from $1.204 trillion a week ago), or 37.6%, and Government Agency securities totaling $274.5 billion (up from $256.6 billion), or 8.2%. Commercial Paper (CP) totaled $111.8 billion (up from a week ago at $88.9 billion), or 3.3%. Certificates of Deposit (CDs) totaled $92.8 billion (up from $67.6 billion a week ago), or 2.8%. The Other category accounted for $104.9 billion or 3.1%, while VRDNs accounted for $44.7 billion, or 1.3%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.472 trillion (43.7% of total holdings), Fixed Income Clearing Corp with $323.3B (9.6%), Federal Home Loan Bank with $209.9B (6.2%), the Federal Reserve Bank of New York with $141.1 billion (4.2%), Citi with $85.9B (2.6%), JP Morgan with $85.8B (2.5%), BNP Paribas with $76.9B (2.3%), RBC with $62.4B (1.9%), Federal Farm Credit Bank with $62.2B (1.8%) and Bank of America with $48.7B (1.4%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($254.4B), Goldman Sachs FS Govt ($231.4B), JPMorgan 100% US Treas MMkt ($204.6B), Fidelity Inv MM: Govt Port ($202.0B), Federated Hermes Govt ObI ($150.1B), BlackRock Lq FedFund ($148.9B), Morgan Stanley Inst Liq Govt ($138.6B), Fidelity Inv MM: MM Port ($130.5B), State Street Inst US Govt ($123.4B) and BlackRock Lq Treas Tr ($116.5B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)

Money fund yields were up 1 bp at 5.13% on average (as measured by our Crane 100 Money Fund Index) in the week ended May 24, after being unchanged the week prior. Our Crane 100 is an average of 7-day yields for the 100 largest taxable money funds. Yields were 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. The vast majority of money market fund assets now yield 5.0% or higher. Assets of money market funds fell by $11.8 billion last week to $6.434 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were unchanged last week. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 714), shows a 7-day yield of 5.03%, unchanged in the week through Friday. Prime Inst MFs were unchanged at 5.20% in the latest week. Government Inst MFs were up 1 bp at 5.11%. Treasury Inst MFs were unchanged at 5.07%. Treasury Retail MFs currently yield 4.85%, Government Retail MFs yield 4.83%, and Prime Retail MFs yield 5.03%, Tax-exempt MF 7-day yields were down 7 bps at 3.26%. According to Tuesday's Money Fund Intelligence Daily, with data as of Friday (5/24), 17 money funds (out of 835 total) yield under 3.0% with $1.0 billion in assets, or 0.0%; 108 funds yield between 3.00% and 3.99% ($135.6 billion, or 2.1%), 250 funds yield between 4.0% and 4.99% ($1.322 trillion, or 20.5%) and 460 funds now yield 5.0% or more ($4.976 trillion, or 77.3%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.63%. The latest Brokerage Sweep Intelligence, with data as of May 24, shows that there were no changes over the past week, the week prior we saw the removal of TD Ameritrade from the listings pushed the averages higher (2 bps). Three of the 10 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. (Note: Two weeks ago we removed rates for TD Ameritrade from BSI since it completed its merger with Charles Schwab.)

DWS posted a brief titled, "U.S. money market funds - a safe haven?" It tells us, "U.S. money market funds (MMFs) have experienced massive inflows since the end of 2022. At just above USD 6 trillion, they currently stand at an all-time high. In our view this isn't about to change: big outflows are unlikely in the shorter-term. But what has driven the enormous interest in this short-term investment opportunity is an important question. As is what would need to happen for capital to be withdrawn equally suddenly. These investments are, by their very nature, short term, and (overly) rapid outflows, reallocating the funds to other asset classes, can certainly happen, making markets volatile." DWS writes, "Money market funds have also seen inflows in the Eurozone recently, but the volumes appear relatively small. The chief reason, in our view, is that European investors place much less emphasis on the security aspect of funds than their U.S. counterparts. Given the much lower importance of money market funds in Europe and the Eurozone, we are only looking at the U.S. instruments in this publication." The piece explains, "In principle, MMFs do not differ from other investment funds in the way they work, and this is also an important reason why retail investors are increasingly using them to park their capital. When investor nervousness and volatility are high in the markets, money market funds tend to become more popular.... Looking at flows into U.S. money market funds over the past decade and a half, it is easy to see that periods of financial market stress have often led to a noticeable increase in volumes. The underlying source of the nervousness, whether geopolitical or from market stresses, did not seem to matter." DWS's article adds, "Research by the Federal Reserve Bank of New York has shown that, in the past, a one percentage point increase in the effective federal funds rate led to a 6-percentage point increase in fund assets over a two-year period because of the close correlation with money market fund yields. This shows that money flows are generally quite slow to react to changes in yields. In our view, however, it is also important to note that the relationship often does not hold during periods of financial stress. A pertinent example is the Covid-19 outbreak in 2020, when a massive increase in money market fund inflows coincided with a sharp decline in policy rates. Another factor in this context is the sometimes stronger, sometimes less pronounced competition between money market funds and investors' deposits at banks.... To summarize, relative attractiveness of course influences inflows into money market funds, but the relationships are complex. Which influencing factor dominates the inflows into money market funds depends very much on the broad market constellation."

ICI's latest "Money Market Fund Assets" report shows money market mutual fund assets rising for the fifth straight week, breaking back above $6.0 trillion 3 weeks ago. MMF assets are up by $179 billion, or 3.8%, year-to-date in 2024 (through 5/22/24), with Institutional MMFs up $38 billion, or 1.2% and Retail MMFs up $142 billion, or 8.4%. Over the past 52 weeks, money funds have risen by $677 billion, or 12.6%, with Retail MMFs rising by $473 billion (24.1%) and Inst MMFs rising by $204 billion (6.0%). The weekly release says, "Total money market fund assets increased by $17.08 billion to $6.07 trillion for the week ended Wednesday, May 22, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $6.82 billion and prime funds increased by $7.68 billion. Tax-exempt money market funds increased by $2.58 billion." ICI's stats show Institutional MMFs increasing $11.4 billion and Retail MMFs rising $5.7 billion in the latest week. Total Government MMF assets, including Treasury funds, were $4.901 trillion (80.8% of all money funds), while Total Prime MMFs were $1.036 trillion (17.1%). Tax Exempt MMFs totaled $128.9 billion (2.1%). ICI explains, "Assets of retail money market funds increased by $5.72 billion to $2.43 trillion. Among retail funds, government money market fund assets decreased by $729 million to $1.55 trillion, prime money market fund assets increased by $4.48 billion to $763.89 billion, and tax-exempt fund assets increased by $1.97 billion to $117.00 billion." Retail assets account for over a third of total assets, or 40.1%, and Government Retail assets make up 63.8% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $11.36 billion to $3.63 trillion. Among institutional funds, government money market fund assets increased by $7.55 billion to $3.35 trillion, prime money market fund assets increased by $3.20 billion to $271.82 billion, and tax-exempt fund assets increased by $613 million to $11.90 billion." Institutional assets accounted for 59.9% of all MMF assets, with Government Institutional assets making up 92.2% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have risen by $80.7 billion in May (through 5/22) to $6.462 trillion. (They hit a record $6.538 trillion on 4/2.) Assets fell $15.8 billion in April and $68.8 billion in March. But they rose $72.1 billion in February, $93.9 billion in January, $32.7 billion in December and $226.4 billion in November. MMF totals fell by $31.9 billion in October. They rose $93.9 billion in September, $98.3 billion in August and $34.7 billion in July. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $400 billion lower than Crane's asset series.

The Federal Reserve Bank of New York updated its list of "Reverse Repo Counterparties." The statement says, "Prudential Government Money Market Fund, Inc. – PGIM Core Government Money Market Fund has been added to the list of reverse repo counterparties, effective May 17, 2024." The NY Fed's current list of "Money Market Funds" now includes: AllianceBernstein: AB Fixed-Income Shares, Inc., AB Government Money Market Portfolio; Allspring Funds Management: Allspring Government Money Market Fund, Allspring Heritage Money Market Fund, Allspring Money Market Fund and Allspring Treasury Plus Money Market Fund; BlackRock Liquidity Funds: FedFund, T-Fund, TempCash, TempFund, Money Market Master Portfolio and Treasury Money Market Master Portfolio; BNY Mellon Investment Adviser: Dreyfus Cash Management, Dreyfus Government Cash Management, Dreyfus Institutional Preferred Government Money Market Fund, Dreyfus Treasury and Agency Liquidity Money Market Fund, Dreyfus Treasury Obligations Cash Management; Capital Research and Management Company: American Funds U.S. Government Money Market Fund and Capital Group Central Fund Series, Capital Group Central Cash Fund; Charles Schwab Investment Management: Schwab Government Money Fund, Schwab Treasury Obligations Money Fund, Schwab Value Advantage Money Fund and Schwab Variable Share Price Money Fund; Columbia Management Investment Advisers: Columbia Short-Term Cash Fund, a series of Columbia Funds Series Trust II; Deutsche Investment Management Americas: Government Cash Management Portfolio; Dimensional Fund Advisors LP: The DFA Short Term Investment Fund of The DFA Investment Trust Company; Federated Investment Management: Edward Jones Money Market Fund, Federated Hermes Capital Reserves Fund, Federated Hermes Government Obligations Fund, Federated Hermes Government Obligations Tax-Managed Fund, Federated Hermes Government Reserves Fund, Federated Hermes Inst Prime Obligations Fund, Federated Hermes Inst Prime Value Obligations Fund, Federated Hermes Municipal Obligations Fund, Federated Hermes Prime Cash Obligations Fund, Federated Hermes Tax-Free Obligations Fund, Federated Hermes Treasury Obligations Fund, Federated Hermes Trust for U.S. Treasury Obligations and Federated Hermes U.S. Treasury Cash Reserves; Fidelity Management & Research Company: Fidelity Colchester Street Trust: Government Portfolio, Fidelity Colchester Street Trust: Money Market Portfolio, Fidelity Colchester Street Trust: Treasury Portfolio, Fidelity Hereford Street Trust: Fidelity Government Money Market Fund, Fidelity Hereford Street Trust: Fidelity Money Market Fund, Fidelity Newbury Street Trust: Fidelity Treasury Money Market Fund, Fidelity Phillips Street Trust: Fidelity Government Cash Reserves, Fidelity Revere Street Trust: Fidelity Cash Central Fund, Fidelity Revere Street Trust: Fidelity Securities Lending Cash Central Fund, Fidelity Salem Street Trust: Fidelity Series Government Money Market Fund and VIP Government Money Market Portfolio; Franklin Advisers: The Money Market Portfolio; Goldman Sachs Asset Management: Goldman Sachs Financial Square Government Fund, Goldman Sachs Financial Square Money Market Fund, Goldman Sachs Financial Square Prime Obligations Fund, Goldman Sachs Financial Square Treasury Obligations Fund and Goldman Sachs Financial Square Treasury Solutions Fund; HSBC Global Asset Management (USA): HSBC U.S. Government Money Market Fund; Invesco Advisers: STIT Government and Agency Portfolio and STIT Treasury Portfolio; J.P. Morgan Investment Management: JPMorgan Liquid Assets Money Market Fund, JPMorgan Prime Money Market Fund, JPMorgan Tax Free Money Market Fund, JPMorgan U.S. Government Money Market Fund and JPMorgan U.S. Treasury Plus Money Market Fund; Legg Mason Partners Fund Advisor: Western Asset/Government Portfolio, Western Asset/Liquid Reserves Portfolio and Western Asset/U.S. Treasury Reserves Portfolio; Morgan Stanley Investment Management: Morgan Stanley Institutional Liquidity Funds Government Portfolio, Morgan Stanley Institutional Liquidity Funds Government Securities Portfolio, Morgan Stanley Institutional Liquidity Funds Prime Portfolio, Morgan Stanley Institutional Liquidity Funds Treasury Portfolio and Morgan Stanley Institutional Liquidity Funds Treasury Securities Portfolio; Northern Trust Investments: NTAM Treasury Assets Fund, Northern Funds - U.S. Government Money Market Fund, Northern Funds - U.S. Government Select Money Market Fund, Northern Institutional Funds - Government Portfolio, Northern Institutional Funds - Government Select Portfolio and Northern Institutional Funds - Treasury Portfolio; Pacific Investment Management Company LLC: PIMCO Funds: PIMCO Government Money Market Fund; PGIM Investments LLC: Prudential Investment Portfolios 2 - PGIM Institutional Money Market Fund; Principal Global Investors, LLC: Principal Funds, Inc. - Government Money Market Fund; RBC Global Asset Management (U.S.): RBC Funds Trust, U.S. Government Money Market Fund; SSgA Funds Management: Institutional Liquid Reserve Portfolio, Institutional US Gov. Money Market Fund, a series of the State Street Master Funds, State Street Navigator Securities Lending Government Money Market Portfolio and State Street Treasury Plus Money Market Portfolio; T. Rowe Price Associates: T. Rowe Price Government Money Fund, Inc., T. Rowe Price Government Reserve Fund, T. Rowe Price Treasury Reserve Fund and T. Rowe Price U.S. Treasury Money Fund; UBS Asset Management (Americas): Government Master Fund, Limited Purpose Cash Investment Fund, Prime Master Fund and Treasury Master Fund; U.S. Bancorp Asset Management: First American Government Obligations Fund and First American Treasury Obligations Fund; The Vanguard Group: Vanguard Treasury Money Market Fund, Vanguard Market Liquidity Fund and Vanguard Cash Reserves Federal Money Market Fund; and Wilmington Funds Management: Wilmington U.S. Government Money Market Fund. The NY Fed describes the "Eligibility criteria of the program, "In order to be eligible to become a reverse repo counterparty, a firm must be either: A state or federally chartered bank or savings association (or a state or federally licensed branch or agency of a foreign bank) with total assets equal to or greater than $30 billion, or reserve balances equal to or greater than $10 billion on the last quarter for which relevant reports are available; or A government-sponsored enterprise; or An SEC-registered 2a-7 fund that has, measured at each month-end for the most recent six consecutive months, either net assets of no less than $2 billion or an average outstanding amount of RRP transactions of no less than $500 million. Firms must already have arrangements in place to operate in the triparty repo market, in transactions collateralized by U.S. government debt, agency debt and agency mortgage-backed securities. Firms must be able to execute RRPs with securities margined at 100% (i.e. the value of the securities provided by the New York Fed will equal the funds provided by the counterparty)." (See here for the NY Fed's latest "Repo and Reverse Repo Operations".)

Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of May 17) includes Holdings information from 68 money funds (unchanged from a week ago), or $3.103 trillion (up from $3.088 trillion) of the $6.446 trillion in total money fund assets (or 48.1%) tracked by Crane Data. (Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our May 10 News, "May Money Fund Portfolio Holdings: Repo Jumps to No. 1, T-Bills Plunge.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.387 trillion (down from $1.397 trillion a week ago), or 44.7%; Repurchase Agreements (Repo) totaling $1.204 trillion (up from $1.172 trillion a week ago), or 38.8%, and Government Agency securities totaling $256.6 billion (down from $258.2 billion), or 8.3%. Commercial Paper (CP) totaled $88.9 billion (down from a week ago at $91.0 billion), or 2.9%. Certificates of Deposit (CDs) totaled $67.6 billion (down from $70.2 billion a week ago), or 2.2%. The Other category accounted for $67.5 billion or 2.2%, while VRDNs accounted for $31.7 billion, or 1.0%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.387 trillion (44.7% of total holdings), Fixed Income Clearing Corp with $277.9B (9.0%), Federal Home Loan Bank with $194.2B (6.3%), the Federal Reserve Bank of New York with $143.9 billion (4.6%), BNP Paribas with $78.8B (2.5%), Citi with $77.8B (2.5%), JP Morgan with $74.9B (2.4%), RBC with $65.3B (2.1%), Federal Farm Credit Bank with $60.0B (1.9%) and Goldman Sachs with $48.8B (1.6%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($257.2B), Goldman Sachs FS Govt ($229.3B), JPMorgan 100% US Treas MMkt ($203.3B), Fidelity Inv MM: Govt Port ($196.0B), BlackRock Lq FedFund ($147.3B), Morgan Stanley Inst Liq Govt ($139.6B), State Street Inst US Govt ($128.8B), Fidelity Inv MM: MM Port ($127.8B), Allspring Govt MM ($118.9B) and BlackRock Lq Treas Tr ($116.0B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)

Money fund yields were unchanged at 5.12% on average (as measured by our Crane 100 Money Fund Index) in the week ended May 17, after being down 1 bp the week prior. Our Crane 100 is an average of 7-day yields for the 100 largest taxable money funds. Yields were 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. The vast majority of money market fund assets now yield 5.0% or higher. Assets of money market funds rose by $23.8 billion last week to $6.446 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were unchanged last week. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 714), shows a 7-day yield of 5.03%, unchanged in the week through Friday. Prime Inst MFs were unchanged at 5.20% in the latest week. Government Inst MFs were unchanged at 5.10%. Treasury Inst MFs were up 1 bp at 5.07%. Treasury Retail MFs currently yield 4.85%, Government Retail MFs yield 4.83%, and Prime Retail MFs yield 5.03%, Tax-exempt MF 7-day yields were up 34 bps at 3.33%. According to Monday's Money Fund Intelligence Daily, with data as of Friday (5/17), 13 money funds (out of 835 total) yield under 3.0% with $399 million in assets, or 0.0%; 112 funds yield between 3.00% and 3.99% ($134.6 billion, or 2.1%), 250 funds yield between 4.0% and 4.99% ($1.323 trillion, or 20.5%) and 460 funds now yield 5.0% or more ($4.988 trillion, or 77.4%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was up 2 bps at 0.63%. The latest Brokerage Sweep Intelligence, with data as of May 17, shows that there were no changes over the past week, but the removal of TD Ameritrade from the listings pushed the averages higher. Three of the 10 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. (Note: We removed rates from TD Ameritrade in this week's file since it completed its merger with Charles Schwab. For more, see Schwab Statement Regarding Final Ameritrade Transition Group, which says, "The Charles Schwab Corporation has completed its fifth and final round of client account transitions associated with the acquisition of Ameritrade, marking the completion of a historic integration.)

S&P Global Ratings published a release titled, "Four Nedgroup Funds Assigned South African National Scale Fund Credit Quality And Volatility Ratings," which tells us, "S&P Global Ratings ... said it has assigned its South African national scale (SANS) fund credit quality (FCQR) and fund volatility ratings (FVR) to three money market funds and one fixed income fund, sponsored by Nedgroup Investments (Pty) Ltd. The funds are domiciled in South Africa and managed by Taquanta Asset Managers (Pty) Ltd., a specialist cash and fixed income investment boutique based in Cape Town. The South African national scale fund credit quality and fund volatility ratings have been assigned as follows: Nedgroup Investments Prime Money Market Fund:'zaAAAf/zaS1+'; Nedgroup Investments Corporate Money Market Fund:'zaAA+f/zaS1+'; Nedgroup Investments Money Market Fund:'zaAAf/zaS1+’; and, Nedgroup Investments Core Income Fund:'zaAA-f/zaS1+'." S&P says, "The assigned 'zaS1+' FVR signifies that, in our view, the funds exhibit extremely low volatility of returns, comparable with a portfolio of one-year commercial bank deposit rates denominated in the base currency of the fund, (South African rand; ZAR). We assigned the FVRs following our review of historical volatility and the dispersion of fund returns relative to reference indices. Next, we evaluated portfolio risk considering duration, credit exposures, liquidity, derivatives, leverage, foreign currency, and investment concentration. We determined that these portfolio risk factors were consistent and therefore made no adjustment to the preliminary FVR in our review of return volatility and dispersion." They add, "Nedgroup Investments Prime Money Market Fund (zaAAAf/zaS1+) aims to maximize interest income, preserve the portfolio's capital, and provide immediate liquidity, by maintaining a certain minimum of assets in liquid form as determined by the manager and with a maximum instrument term to final maturity of 13 months. As of March 31, 2024, the fund had 74% portfolio exposure to the Republic of South Africa; 80% of the portfolio was maturing within three months and had recorded a weighted-average maturity of 0.15 years (approximately 55 days). We note the maximum fund weighted-average duration is limited to 90 days and over the past four years has averaged about 67 days." Finally, S&P tells us, "The funds sponsor, Nedgroup Investments Pty Ltd., is a subsidiary of Nedbank Group Ltd.... In our view, the Cape Town-based portfolio management team at Taquanta Asset Managers (Pty) Ltd. is a highly experienced group of cash and treasury investment professionals. They are supported by a risk management infrastructure and systems commensurate with an asset management entity that has an established track record in managing fixed-income assets for clients in South Africa. The rated funds belong to the Nedgroup Collective Investments Ltd. scheme, which has been approved under the deed executed under the Collective Investment Schemes Control Act, 2002 (Act No. 45 of 2002). Fund administration services are provided internally by Taquanta Asset Managers (Pty) Ltd. and The Standard Bank of South Africa Limited acts in the capacity of trustee and custodian to the scheme."

ICI's latest "Money Market Fund Assets" report shows money market mutual fund assets rising for the fourth straight week, breaking back above $6.0 trillion 2 weeks ago. MMF assets are up by $162 billion, or 3.4%, year-to-date in 2024 (through 5/15/24), with Institutional MMFs up $26 billion, or 0.9% and Retail MMFs up $136 billion, or 8.1%. Over the past 52 weeks, money funds have risen by $707 billion, or 13.2%, with Retail MMFs rising by $474 billion (24.3%) and Inst MMFs rising by $233 billion (6.9%). The weekly release says, "Total money market fund assets increased by $16.36 billion to $6.05 trillion for the week ended Wednesday, May 15, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $17.23 billion and prime funds increased by $1.89 billion. Tax-exempt money market funds decreased by $2.76 billion." ICI's stats show Institutional MMFs increasing $11.2 billion and Retail MMFs rising $5.2 billion in the latest week. Total Government MMF assets, including Treasury funds, were $4.894 trillion (80.9% of all money funds), while Total Prime MMFs were $1.028 trillion (17.0%). Tax Exempt MMFs totaled $126.3 billion (2.1%). ICI explains, "Assets of retail money market funds increased by $5.18 billion to $2.43 trillion. Among retail funds, government money market fund assets increased by $2.41 billion to $1.55 trillion, prime money market fund assets increased by $3.87 billion to $759.41 billion, and tax-exempt fund assets decreased by $1.09 billion to $115.03 billion." Retail assets account for over a third of total assets, or 40.1%, and Government Retail assets make up 64.0% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $11.18 billion to $3.62 trillion. Among institutional funds, government money market fund assets increased by $14.82 billion to $3.34 trillion, prime money market fund assets decreased by $1.98 billion to $268.62 billion, and tax-exempt fund assets decreased by $1.67 billion to $11.29 billion." Institutional assets accounted for 59.9% of all MMF assets, with Government Institutional assets making up 92.3% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have risen by $62.9 billion in May (through 5/15) to $6.446 trillion. (They hit a record $6.538 trillion on 4/2.) Assets fell $15.8 billion in April and $68.8 billion in March. But they rose $72.1 billion in February, $93.9 billion in January, $32.7 billion in December and $226.4 billion in November. MMF totals fell by $31.9 billion in October. They rose $93.9 billion in September, $98.3 billion in August and $34.7 billion in July. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $400 billion lower than Crane's asset series.

The Federal Reserve Bank of New York's Liberty Street Economics recently published an article titled, "Who Is Borrowing and Lending in the Eurodollar and Selected Deposit Markets?" It states, "A recent Liberty Street Economics post discussed who is borrowing and lending in the federal funds (fed funds) market. This post explores activity in two other markets for short-term bank liabilities that are often perceived as close substitutes for fed funds -- the markets for Eurodollars and 'selected deposits.'" The blog continues, "Eurodollars are unsecured U.S. dollar deposits that are booked at bank offices outside of the United States. A central function of Eurodollars is that they can be used by banks to meet their dollar funding needs. U.S.-based banks -- U.S. depository institutions or U.S. branches and agencies of foreign banks -- can accept Eurodollars, typically with an overnight maturity, in offshore branches and then transfer the funds onshore. Selected deposits are unsecured U.S. dollar deposits that also tend to have an overnight maturity, similar to Eurodollars. However, unlike Eurodollars, but like fed funds, selected deposits are booked at bank offices in the U.S. Historically, Eurodollars and selected deposits have played a role similar to fed funds as a source of short-term wholesale unsecured funding for banks, but there have been differences in how regulation has treated these dollar deposits. For instance, fed funds were historically exempt from reserve requirements; Eurodollars also became exempt in 1990. It was only in 2020 that selected deposits became exempt, when the Federal Reserve eliminated all requirements to hold reserves against certain types of deposits and other bank liabilities, including selected deposits. Additionally, prior to the repeal of Regulation Q in 2011, banks were not permitted to pay interest on demand deposits, including selected deposits." Asking, "Who's Borrowing?" they reply, "The main borrowers of Eurodollars and selected deposits are the U.S. branches and agencies of foreign banks (FBO branches). On an average day, FBO branches borrow between $50 billion and $200 billion, accounting for over 90 percent of total daily volume since 2016. As we discussed in an earlier post, FBO branches are also the main borrowers in the fed funds market, with a market share ranging between 65 and 95 percent of the total daily volume." "Who's Lending?" The article says, "The main lenders in Eurodollars and selected deposits are non-depository institutions that primarily engage in financial intermediation services such as brokerage, underwriting, credit origination, credit card, insurance, and pension services, among others.... [T]hese financial institutions represent 80 percent of the volume lent in the overnight Eurodollar and selected deposit markets." Finally, the blog summarizes, "Changes in regulation and in the economic conditions in the U.S. banking system since the Great Financial Crisis have contributed to the narrowing of the differences between Eurodollars, selected deposits, and fed funds, with selected deposits trading overtaking the Eurodollar market in recent years. Given their lower costs of borrowing, FBO branches are the main borrowers in all these markets. The set of lenders, however, is considerably larger for Eurodollars and selected deposits. The regulatory advantage of fed funds still makes them relatively more attractive, which is reflected in the higher rates at which they trade."

ICI released its latest monthly "Money Market Fund Holdings" summary, which reviews the aggregate daily and weekly liquid assets, regional exposure, and maturities (WAM and WAL) for Prime and Government money market funds. This release says, "The Investment Company Institute (ICI) reports that, as of the final Friday in April, prime money market funds held 45.3 percent of their portfolios in daily liquid assets and 60.7 percent in weekly liquid assets, while government money market funds held 77.9 percent of their portfolios in daily liquid assets and 87.9 percent in weekly liquid assets." Prime DLA was up from 41.1% in March, and Prime WLA was up from 59.5%. Govt MMFs' DLA was down from 78.6% and Govt WLA decreased from 88.1% the previous month. ICI explains, "At the end of April, prime funds had a weighted average maturity (WAM) of 31 days and a weighted average life (WAL) of 48 days. Average WAMs and WALs are asset-weighted. Government money market funds had a WAM of 37 days and a WAL of 83 days." Prime WAMs were 5 days shorter and WALs were 4 days shorter from the previous month. Govt WAMs were 3 days shorter and WALs were 2 days shorter from March. Regarding Holdings by Region of Issuer, the release tells us, "Prime money market funds’ holdings attributable to the Americas declined from $545.08 billion in March to $510.99 billion in April. Government money market funds’ holdings attributable to the Americas declined from $4,446.73 billion in March to $4,319.26 billion in April." The Prime Money Market Funds by Region of Issuer table shows Americas-related holdings at $511.0 billion, or 50.8%; Asia and Pacific at $165.4 billion, or 16.4%; Europe at $317.1 billion, or 31.5%; and, Other (including Supranational) at $12.9 billion, or 1.3%. The Government Money Market Funds by Region of Issuer table shows Americas at $4.319 trillion, or 89.1%; Asia and Pacific at $134.6 billion, or 2.8%; Europe at $370.5 billion, 7.6%, and Other (Including Supranational) at $24.5 billion, or 0.5%.

Money fund yields were down 1 basis point to 5.12% on average (as measured by our Crane 100 Money Fund Index) in the week ended May 10, after being unchanged the week prior. Our Crane 100 is an average of 7-day yields for the 100 largest taxable money funds. Yields were 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. The vast majority of money market fund assets now yield 5.0% or higher. Assets of money market funds rose by $22.8 billion last week to $6.422 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were unchanged last week. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 714), shows a 7-day yield of 5.03%, unchanged in the week through Friday. Prime Inst MFs were down 1 bp at 5.20% in the latest week. Government Inst MFs were down 1 bp at 5.10%. Treasury Inst MFs were unchanged at 5.06%. Treasury Retail MFs currently yield 4.85%, Government Retail MFs yield 4.82%, and Prime Retail MFs yield 5.02%, Tax-exempt MF 7-day yields were down 27 bps at 3.00%. According to Monday's Money Fund Intelligence Daily, with data as of Friday (5/10), 53 money funds (out of 835 total) yield under 3.0% with $18.5 billion in assets, or 0.3%; 72 funds yield between 3.00% and 3.99% ($116.0 billion, or 1.8%), 255 funds yield between 4.0% and 4.99% ($1.325 trillion, or 20.6%) and 455 funds now yield 5.0% or more ($4.962 trillion, or 77.3%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.61%. The latest Brokerage Sweep Intelligence, with data as of May 10, shows that there were 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.

With just one month to go, preparations are fully underway for Crane Data's big show, Money Fund Symposium. Money Fund Symposium 2024 is scheduled for June 12-14, 2024 at The Westin Pittsburgh, in Pittsburgh, Pa, and we're expecting a near-record crowd of over 550. The latest agenda for the largest gathering of money market fund managers and cash investors in the world is available and registrations are still being taken. Money Fund Symposium attracts money fund managers, marketers and servicers, cash investors, money market securities dealers, issuers, and regulators. Visit the Money Fund Symposium website at www.moneyfundsymposium.com for more information. Registration is $1,000, and discounted hotel reservations are available. We hope you'll join us in Pittsburgh in June! We're also making plans for our next European Money Fund Symposium, which is scheduled for Sept. 19-20, 2024, in London, England. Our 2023 event in Edinburgh, Scotland attracted a record 166 attendees, so we expect our 2024 event to be even bigger. Watch for the draft agenda to be posted in coming weeks and registration ($1000 to attend) is now live. European Money Fund Symposium offers "offshore" money fund portfolio managers, and money market investors, issuers, dealers and service providers a concentrated and affordable educational experience, as well as an excellent and informal networking venue. Mark your calendars too for our next Money Fund University "basic training" event, scheduled for Dec. 19-20, 2024, in Providence, R.I, and for next year's Bond Fund Symposium conference, which is scheduled for March 27-28, 2025, in Newport Beach, Calif. Let us know if you'd like more details on any of our events, and we hope to see you in Pittsburgh in June, in London in September, in Providence in December or in Newport Beach next March!

ICI's latest "Money Market Fund Assets" report shows money market mutual fund assets rising for the third straight week, after retaking the $6.0 trillion level last week. MMF assets are up by $146 billion, or 3.1%, year-to-date in 2024 (through 5/8/24), with Institutional MMFs up $15 billion, or 0.5% and Retail MMFs up $131 billion, or 7.8%. Over the past 52 weeks, money funds have risen by $704 billion, or 13.2%, with Retail MMFs rising by $483 billion (25.0%) and Inst MMFs rising by $221 billion (6.5%). The weekly release says, "Total money market fund assets increased by $31.14 billion to $6.03 trillion for the week ended Wednesday, May 8, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $19.81 billion and prime funds increased by $8.55 billion. Tax-exempt money market funds increased by $2.77 billion." ICI's stats show Institutional MMFs increasing $23.3 billion and Retail MMFs rising $7.9 billion in the latest week. Total Government MMF assets, including Treasury funds, were $4.877 trillion (80.8% of all money funds), while Total Prime MMFs were $1.026 trillion (17.0%). Tax Exempt MMFs totaled $129.1 billion (2.1%). ICI explains, "Assets of retail money market funds increased by $7.87 billion to $2.42 trillion. Among retail funds, government money market fund assets increased by $974 million to $1.55 trillion, prime money market fund assets increased by $4.84 billion to $755.55 billion, and tax-exempt fund assets increased by $2.06 billion to $116.12 billion." Retail assets account for over a third of total assets, or 40.1%, and Government Retail assets make up 64.0% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $23.26 billion to $3.61 trillion. Among institutional funds, government money market fund assets increased by $18.84 billion to $3.33 trillion, prime money market fund assets increased by $3.71 billion to $270.60 billion, and tax-exempt fund assets increased by $717 million to $12.96 billion." Institutional assets accounted for 59.9% of all MMF assets, with Government Institutional assets making up 92.1% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have rose by $50.2 billion in May (through 5/8) to $6.432 trillion. (A month prior, they were a record $6.538 trillion on 4/2.) Assets fell $15.8 billion in April and $68.8 billion in March. But they rose $72.1 billion in February, $93.9 billion in January, $32.7 billion in December and $226.4 billion in November. MMF totals fell by $31.9 billion in October. They rose $93.9 billion in September, $98.3 billion in August and $34.7 billion in July. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $400 billion lower than Crane's asset series.

Bloomberg writes, "Berkshire Cash Hoard Scores Another Record as Earnings Gain," and The Wall Street Journal writes, "WSJ Buffett Rules Out ‘Eye-Popping’ Returns. But Investors Aren’t Listening." The former tells us, "Berkshire Hathaway Inc.'s cash pile hit yet another record as billionaire investor Warren Buffett confronted a dearth of big-ticket deals. Operating earnings also rose, buoyed by his collection of insurance businesses. The firm's hoard increased to $189 billion at the end of the first quarter, topping the record it set at year-end." Meanwhile, the Journal piece says, "They talk about safety and opportunity in Berkshire's mountainous cash pile, which sat at a record $167.6 billion, including cash equivalents, at the end of 2023.... Not only is Berkshire's huge stash of cash valuable for earning interest income, but the growth of its cash levels over six consecutive quarters through the end of 2023 reassures investors who are looking to park their money safely. Berkshire would be ready to pay any big losses that arise from its insurance business." It adds, "The cash also fortifies Berkshire's financial position in case of turmoil in markets or the economy. In the 2008 financial crisis and its aftermath, that strength meant Berkshire could make deals to help rescue blue-chip companies including Goldman Sachs and General Electric. And it leaves Buffett equipped to pounce should he find attractive companies to acquire." Analysts expect Berkshire Hathaway's cash war chest to break the $200 billion level at some point during the current quarter.

A press release from the U.S. Treasury's Office of Financial Research (OFR) titled, "OFR Adopts Final Rule for Data Collection of Non-centrally Cleared Bilateral Transactions in the U.S. Repurchase Agreement Market," states, "The Office of Financial Research (OFR) ... adopted a Final Rule to improve transparency within the U.S. repurchase agreement (repo) market by establishing a data collection for non-centrally cleared bilateral transactions. This data collection requires daily reporting to the OFR by U.S. covered reporters with large exposures to the non-centrally cleared bilateral repo (NCCBR) market. The collected data will be used to support the work of the Financial Stability Oversight Council (Council), its member agencies, and the OFR to identify and monitor risks to financial stability." James Martin, Acting Director of the OFR, comments, "After receiving recommendations from the Council and others to obtain better data on the NCCBR market -- currently the largest of the four repo market segments -- the OFR set out to establish a permanent NCCBR data collection. The OFR consulted with the Council, held extensive discussions with market participants, successfully completed a pilot data collection, and carefully considered public comments on our proposal.... The OFR's permanent data collection will shine a spotlight into this opaque corner of the financial market, provide high-quality data on NCCBR transactions, and remove a significant blind spot for financial regulators." The release adds, "The Final Rule will become effective 60 days after publication in the Federal Register. It establishes two categories of financial companies subject to reporting, a timeline for submission of data depending on the category of covered reporter, and a number of specific data elements required to be reported."

Money fund yields were unchanged at 5.13% on average (as measured by our Crane 100 Money Fund Index) in the week ended May 3, after rising 1 bp the week prior. Our Crane 100 is an average of 7-day yields for the 100 largest taxable money funds. Yields were 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. The vast majority of money market fund assets now yield 5.0% or higher. Assets of money market funds rose by $22.6 billion last week to $6.399 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were unchanged last week. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 712), shows a 7-day yield of 5.03%, unchanged in the week through Friday. Prime Inst MFs were down 1 bp at 5.21% in the latest week. Government Inst MFs were unchanged at 5.11%. Treasury Inst MFs were unchanged at 5.06%. Treasury Retail MFs currently yield 4.85%, Government Retail MFs yield 4.83%, and Prime Retail MFs yield 5.03%, Tax-exempt MF 7-day yields were down 18 bps at 3.27%. According to Monday's Money Fund Intelligence Daily, with data as of Friday (5/3), 17 money funds (out of 833 total) yield under 3.0% with $1.1 billion in assets, or 0.0%; 108 funds yield between 3.00% and 3.99% ($134.1 billion, or 2.1%), 252 funds yield between 4.0% and 4.99% ($1.326 trillion, or 20.7%) and 456 funds now yield 5.0% or more ($4.937 trillion, or 77.2%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.61%. The latest Brokerage Sweep Intelligence, with data as of May 3, shows that there were 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.

US News recently published an article titled, "Sweep Accounts: What They Are and How to Open One." It states, "Bank savers are on a roll these days, with many certificates of deposit, money market accounts and high-yield savings accounts offering around 5% returns due to a high-interest-rate environment. The rush for a competitive yield has enveloped the sweep account, which has operated in a quiet, under-the-radar fashion off Wall Street's beaten path for decades. Sweep accounts automatically steer cash into bank or brokerage money market accounts that can earn ample interest at the close of each business day. Instead of earning zero dollars, a sweep account enables savers and investors to earn yields on funds that would otherwise lose value to inflation." The piece says, "With competitive money market rates, a sweep account offers a profitable safe haven for cash funds parked overnight. On the downside, fees may cut into those sweep account gains, and returns in money market accounts -- like any asset -- aren't always consistent and depend on favorable interest rates. Here's a closer look at sweep accounts, how they work and whether they're a no-brainer for income-seeking bank and brokerage investors." US News adds, "Sweep accounts automatically move, or 'sweep,' any cash that exceeds the set limit in your bank or brokerage account into an investment account. They can be used for individual or business banking and brokerage customers. 'This way, your extra money earns interest and doesn't just sit there idling,' says Dayten Rynsburger, chief revenue officer at lending platform Niche Capital. 'Investors like these accounts -- they think of them as 'automated investing.'"

ICI's latest "Money Market Fund Assets" report shows money market mutual fund assets rising again to retake the $6.0 trillion level, after falling sharply in mid-April due to tax payments. MMF assets are up by $115 billion, or 2.4%, year-to-date in 2024 (through 5/1/24), with Institutional MMFs down $8 billion, or -0.3% and Retail MMFs up $123 billion, or 7.3%. Over the past 52 weeks, money funds have risen by $691 billion, or 13.0%, with Retail MMFs rising by $488 billion (25.3%) and Inst MMFs rising by $204 billion (6.0%). The weekly release says, "Total money market fund assets increased by $23.62 billion to $6.00 trillion for the week ended Wednesday, May 1, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $21.33 billion and prime funds increased by $867 million. Tax-exempt money market funds increased by $1.42 billion." ICI's stats show Institutional MMFs increasing $11.5 billion and Retail MMFs rising $12.1 billion in the latest week. Total Government MMF assets, including Treasury funds, were $4.857 trillion (80.9% of all money funds), while Total Prime MMFs were $1.018 trillion (17.0%). Tax Exempt MMFs totaled $126.3 billion (2.1%). ICI explains, "Assets of retail money market funds increased by $12.12 billion to $2.41 trillion. Among retail funds, government money market fund assets increased by $6.92 billion to $1.55 trillion, prime money market fund assets increased by $4.00 billion to $750.70 billion, and tax-exempt fund assets increased by $1.20 billion to $114.06 billion." Retail assets account for over a third of total assets, or 40.2%, and Government Retail assets make up 64.2% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $11.49 billion to $3.59 trillion. Among institutional funds, government money market fund assets increased by $14.41 billion to $3.31 trillion, prime money market fund assets decreased by $3.14 billion to $266.88 billion, and tax-exempt fund assets increased by $216 million to $12.24 billion." Institutional assets accounted for 59.8% of all MMF assets, with Government Institutional assets making up 92.2% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have rose by $5.8 billion the first day of May (through 5/1) to $6.387 trillion. (A month prior, they were a record $6.538 trillion on 4/2.) Assets fell $15.8 billion in April and $68.8 billion in March. But they rose $72.1 billion in February, $93.9 billion in January, $32.7 billion in December and $226.4 billion in November. MMF totals fell by $31.9 billion in October. They rose $93.9 billion in September, $98.3 billion in August and $34.7 billion in July. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $400 billion lower than Crane's asset series.

The Fed's latest release, "Federal Reserve issues FOMC statement," explains, "Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have remained strong, and the unemployment rate has remained low. Inflation has eased over the past year but remains elevated. In recent months, there has been a lack of further progress toward the Committee's 2 percent inflation objective. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. The Committee judges that the risks to achieving its employment and inflation goals have moved toward better balance over the past year. The economic outlook is uncertain, and the Committee remains highly attentive to inflation risks." It continues, "In support of its goals, the Committee decided to maintain the target range for the federal funds rate at 5-1/4 to 5-1/2 percent. In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent. In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion. The Committee will maintain the monthly redemption cap on agency debt and agency mortgage backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities. The Committee is strongly committed to returning inflation to its 2 percent objective." Finally, the FOMC writes, "In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments."

Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of April 26) includes Holdings information from 63 money funds (down 19 from a week ago), or $2.933 trillion (down from $3.463 trillion) of the $6.376 trillion in total money fund assets (or 46.0%) tracked by Crane Data. (Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our April 10 News, "April Money Fund Portfolio Holdings: Repo Rises, Treasuries, TDs Fall.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.370 trillion (down from $1.523 trillion a week ago), or 46.7%; Repurchase Agreements (Repo) totaling $1.064 trillion (down from $1.278 trillion a week ago), or 36.3%, and Government Agency securities totaling $242.3 billion (down from $301.7 billion), or 8.3%. Commercial Paper (CP) totaled $87.9 billion (down from a week ago at $118.5 billion), or 3.0%. Certificates of Deposit (CDs) totaled $72.4 billion (down from $94.4 billion a week ago), or 2.5%. The Other category accounted for $63.4 billion or 2.2%, while VRDNs accounted for $32.3 billion, or 1.1%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.370 trillion (46.7% of total holdings), Fixed Income Clearing Corp with $204.7B (7.0%), Federal Home Loan Bank with $190.1B (6.5%), the Federal Reserve Bank of New York with $134.9 billion (4.6%), BNP Paribas with $75.2B (2.6%), Citi with $71.7B (2.4%), JP Morgan with $71.4B (2.4%), RBC with $62.3B (2.1%), Federal Farm Credit Bank with $49.8B (1.7%) and Goldman Sachs with $43.9B (1.5%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($257.6B), Goldman Sachs FS Govt ($232.5B), JPMorgan 100% US Treas MMkt ($197.9B), Fidelity Inv MM: Govt Port ($197.6B), BlackRock Lq FedFund ($139.4B), Morgan Stanley Inst Liq Govt ($138.5B), Fidelity Inv MM: MM Port ($127.3B), State Street Inst US Govt ($123.2B), Allspring Govt MM ($114.1B) and Dreyfus Govt Cash Mgmt ($112.5B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)

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