Daily Links Archives: July, 2026
NY Fed on Stablecoins and SVB
The Federal Reserve Bank of New York published a paper titled, "Stablecoins and (Non)Crypto Shocks: A 2026 Update." It states, "Stablecoins are digital assets whose value is pegged to that of a fiat currency, typically the U.S. dollar at a peg of $1.00 per token. In a previous blog post, we described the rapid growth of stablecoins through early 2025, highlighted changes in stablecoins' reserve-asset composition, and examined their reactions to Bitcoin price shocks. In this post, we document the growth of stablecoins since our last post. Then, we examine how shocks from outside the crypto industry can impact the composition of stablecoins' reserve assets. For our case study, we use the 2023 failure of Silicon Valley Bank (SVB) and its impact on USD Coin (USDC, issued by Circle), the second-largest stablecoin by market capitalization." The piece explains, "Since our last post in April 2025, the market capitalization of U.S. dollar stablecoins has increased by $71 billion (30 percent) to about $308 billion recently.... This period coincides with the passage of the GENIUS Act in July 2025, which established the first federal regulatory framework for payment stablecoins." It continues, "The stablecoin industry remains highly concentrated, with the two largest issuers, Tether (USDT) and USDC, accounting for over 80 percent of industry assets. The reserve composition of these stablecoins differs significantly: USDC's attested reserves consist primarily of cash and short-term U.S. government securities. In contrast, corporate bonds, gold bars, Bitcoin, secured loans, and 'other investments' accounted for nearly 24 percent of USDT's attested reserves as of December 2025." The blog says, "In prior posts, we examined the impact of positive and negative crypto price shocks on net flows into stablecoins. Here we study a complementary question: how do non-crypto shocks affect net flows into stablecoins and the composition of their reserve assets? This question is important given stablecoins' increasing interconnectedness with traditional financial markets. To answer it, we document the changes in USDC's reserve assets following SVB’s failure in March 2023. On March 11, 2023, Circle reported that approximately 8 percent of USDC's reserves were held at SVB, which had been placed into FDIC receivership the previous day. Following Circle's announcement, USDC's secondary market price dropped considerably below $1.00, and it experienced notable net outflows. In addition to these effects, the composition of the Circle Reserve Fund (CRF), a money market mutual fund (MMF) whose shares can only be purchased by Circle, changed significantly. (The CRF accounts for approximately 86 percent of USDC's reserve assets as of March 2026.)" Finally, the post adds, "Following SVB's failure in March 2023, the composition of USDC's primary reserve asset, held in an MMF, changed notably: the average maturity of its reserve assets declined significantly; its repo holdings surged and became concentrated in FICC in recent years. In addition, its direct deposits with banks shifted from a combination of GSIBs and non-GSIBs to GSIBs. Overall, the SVB event triggered a change in the type of risk held by one of the largest stablecoin issuers, away from interest-rate risk and toward counterparty risk. These changes highlight the growing interconnectedness between traditional finance and new, emerging financial technologies."
Invesco Q2'26 Talks Cash, SuperState
Invesco reported Q2'26 earnings earlier this week, and we quote the few comments involving 'cash' below. (See the earnings call transcript here.) President & CEO Andrew Schlossberg says, "Year to date, we posted record net inflows of $67 billion, or a 7% annualized organic growth rate, generated record net revenue with an increase of 17% over the same period last year.... We have launched more than 50 products this year across the Americas, EMEA, and APAC. This includes six new active ETF launches and a new partnership with SuperState, where we are now the manager of our first tokenized Treasury strategy.... Markets were supportive, driven by strong equity appreciation and improving fixed income returns, resulting in investor capital remaining in motion across the industry, albeit more narrowly focused and mindful of ongoing macroeconomic and policy uncertainty.... Net long-term inflows during the period were a record $45.1 billion, marking the 12th straight quarter of net inflows and representing annualized organic growth of nearly 9%. Additionally, we generated $13.2 billion in global liquidity inflows, ending the period with $215 billion in AUM. Altogether, we reached an AUM high water mark of $2.5 trillion." CFO Allison Dukes explains, "Net long-term asset inflows were a record $45 billion in the second quarter. Nearly a 9% annualized organic growth rate, marking the 12th consecutive quarter of net inflows. Favorable markets drove a $257 billion increase in AUM, and net flows to end the money market funds totaled $17 billion for the quarter. AUM at the end of the quarter reached a record high of $2.5 trillion, a 14% increase over the first quarter, and 23% higher than the second quarter of last year. Average long-term AUM was $2.1 trillion, a 7% increase over last quarter and 58% greater than last year." During the Q&A, they were asked about how they won the SuperState deal. Schlossberg answers, "We have a $220 billion global liquidity franchise. We're managing funds for decades. We do have a lot of strength and capability in the liquidity side, maybe it starts with that. The second thing is that we've made a commitment to innovate through digital assets and through establishing partnerships. Having the opportunity to take over that billion-dollar tokenized U.S. Treasury fund was important to us. I think because of our commitment to innovation, our long-term experience on the global liquidity side, and frankly, the vast distribution that we have around the world institutionally and the retail space, I think, created a nice combination for the two of us." On opportunities, Schlossberg adds, "The only thing I'd add is the places where we're seeing organic growth, ETFs, SMAs, fixed income at large, cash. These are all categories that scale pretty well. We're going to continue to expect to see growth in those segments." (For more, see our March 25 Crane Data News, "Invesco to Manage SuperState Tokenized USTB.")
Weekly Money Fund Portfolio Holdings
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 July 24) includes Holdings information from 75 money funds (up 12 from a week ago), or $4.773 trillion (up from $4.367 trillion) of the $8.253 trillion in total money fund assets (or 57.8%) tracked by Crane Data. (Note: 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 July 13 News, "July MF Portfolio Holdings: Assets Flat; Repo Jumps, Treasuries Plunge.”) Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $2.146 trillion (up from $1.968 trillion a week ago), or 45.0%; Repurchase Agreements (Repo) totaling $1.679 trillion (up from $1.572 trillion a week ago), or 35.2%, and Government Agency securities totaling $513.1 billion (up from $463.5 billion a week ago), or 10.7%. Commercial Paper (CP) totaled $186.9 billion (up from $165.5 billion a week ago), or 3.9%. Certificates of Deposit (CDs) totaled $100.8 billion (up from $84.3 billion a week ago), or 2.1%. The Other category accounted for $88.8 billion or 1.9%, while VRDNs accounted for $58.6 billion or 1.2%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $2.146 trillion, Fixed Income Clearing Corp with $479.1B, the Federal Home Loan Bank with $319.4B, JP Morgan with $172.1B, Citi with $136.2B, Federal Farm Credit Bank with $116.7B, RBC with $116.2B, BNP Paribas with $115.6B, Wells Fargo with $98.5B and Bank of America with $67.7B. The Ten Largest Funds tracked in our latest Weekly include: JPMorgan 100% US Trs MM ($351.0B), JPMorgan US Govt MM ($342.8B), Fidelity Inv MM: Govt Port ($288.7B), Goldman Sachs FS Govt ($268.3B), State Street Inst US Govt ($207.4B), Morgan Stanley Inst Liq Govt ($200.3B), BlackRock Lq FedFund ($190.9B), BlackRock Lq Treas Tr ($183.4B), Federated Hermes Govt ObI ($177.4B) and Dreyfus Govt Cash Mgmt ($163.0B). (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 Flat Ahead of Fed
Money fund yields (7-day, annualized, simple, net) were unchanged at 3.47% on average during the week ended Friday, July 24 (as measured by our Crane 100 Money Fund Index), after increasing 2 bps the week prior. Fund yields hadn't been below 3.5% since November 2022, and they are down from a recent high of 5.20% in November 2023. They should remain flat in coming days (and weeks) unless and until the Fed moves rates higher. Yields were 3.44% on 5/31/26, 3.47% on 3/31, 3.58% on 12/31/25, 3.94% on 9/30/25, 4.13% on 6/30/25, 4.14% on 3/31/25 and 4.28% on average on 12/31/24. MMFs averaged 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 723), shows a 7-day yield of 3.38%, up 1 bp in the week through Friday. Prime Inst money fund yields were unchanged at 3.59% in the latest week. Government Inst MFs were up 1 bps at 3.46%. Treasury Inst MFs were up 1 bp at 3.45%. Treasury Retail MFs currently yield 3.22%, Government Retail MFs yield 3.19% and Prime Retail MFs yield 3.37%, Tax-exempt MF 7-day yields were up 19 bps to 2.33%. Money market mutual fund assets hit an all-time record high of $8.404 trillion on July 6, according to our Money Fund Intelligence Daily. But assets have decreased $20.5 billion in the week through Friday, and they've decreased by $97.3 billion in July month-to-date (through 7/24). MMF assets increased by $58.6 billion in June, $208.6 billion in May, decreased by $108.8 billion in April, $49.3 billion in March, increased by $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose by $63.7 billion last July. Weighted average maturities were at 38 days for the Crane MFA and 40 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (7/24), just 162 money funds (out of 834 total) yield under 3.0% with $224.3 billion in assets, or 2.7%, while the vast majority (672) of funds yield between 3.00% and 3.99% ($8.029 trillion, or 97.3%). No funds yield over 4.0%. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.29%, after falling 1 bp nine weeks prior. The latest Brokerage Sweep Intelligence, with data as of July 24, shows no changes over the past week. Four of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch, Morgan Stanley and Schwab.
JPM Update on ABCP: Up 20% YTD
Last week, J.P. Morgan's "JPM Mid-Week US Short Duration Update" featured a brief titled, "ABCP outstandings push 20% higher YTD amid increased equity financing demand." The piece explains, "It has been a strong start to the year for the ABCP market, with total outstandings climbing to nearly $585bn, up almost $100bn (20%) year-to-date, surpassing the pace of growth over the same period in every year since 2020.... As we have discussed previously, this year's growth, like that of the past couple of years, reflects dealers increasingly turning to the ABCP market as an alternative source of financing for both fixed income (mainly Treasuries) and equity collateral. Recall that certain ABCP structures (e.g., independent sponsor programs) can provide banks with off‑balance‑sheet solutions/optimization of funding and potentially favorable accounting treatment by using a conduit to intermediate transactions with a counterparty. In practice, this is typically executed through repo (an alternative way for the counterparty to finance high‑quality liquid assets), reverse repo (asset transfers to the conduit in exchange for short‑term cash), TRS (synthetic exposure without owning the asset outright), and securities lending (securities temporarily move onto the SPE's balance sheet when it borrows, or are acquired with ABCP proceeds and lent to the counterparty when it lends)." It continues, "More recently, the upward trend in ABCP outstandings has become even more pronounced as demand for equity financing has accelerated.... The composition of the ABCP market continues to reflect these financing trends. Independent sponsor programs have driven most of this year's growth, with outstandings increasing by $53bn to $244bn. Bank-sponsored CCP programs have also expanded, rising by $36bn to $104bn. Notably, nearly $60bn, about 60%, of this year's ABCP growth has occurred over the past two months, coinciding with higher equity financing costs and possibly contributing to the rise in independent sponsor programs to roughly 42% of total ABCP outstandings, up from about 30% two years ago.... That gain has largely come at the expense of traditional bank-sponsored multi-seller programs, typically used to finance more traditional assets, whose market share has fallen 13 percentage points to 37% over the same period." J.P. Morgan's update adds, "Looking ahead, we expect ABCP outstandings to remain elevated, especially if dealers continue to seek alternative sources of balance-sheet financing. Equity financing costs should remain spot-dependent and stay rich as long as the bull market holds.... As a result, dealers may continue to tap the ABCP market as an alternative funding source, which could further support balance-sheet optimization, particularly if equity financing needs persist, given Treasury's financing needs remain high. That said, we still believe incremental supply can be absorbed by a diverse investor base, including state and local governments, separately managed accounts, corporates, and prime money market funds. However, issuer concentration bears watching as concentration risk is emerging as a constraint. For now, additional demand likely remains available, albeit potentially at modestly wider spreads."
ICI: MMF Assets Down Again in July
After almost breaking the $8.0 trillion barrier three weeks prior, the Investment Company Institute's latest weekly "Money Market Fund Assets" report shows money fund assets falling $22.6 billion to $7.861 trillion. Assets plunged $59.7 billion the previous week (and decreased $4.8 billion the week before this). MMF assets are up by $786 billion, or 11.1%, over the past 52 weeks (through 7/22/26), with Institutional MMFs up $616 billion, or 14.8% and Retail MMFs up $170 billion, or 5.8%. Year-to-date in 2026, MMF assets are up by $127 billion, or 1.6%, with Institutional MMFs up $121 billion, or 2.6% and Retail MMFs up $6 billion, or 0.2%. ICI's weekly release says, "Total money market fund assets decreased by $22.57 billion to $7.86 trillion for the week ended Wednesday, July 22, the Investment Company Institute reported.... Among taxable money market funds, government funds decreased by $22.49 billion and prime funds decreased by $2.83 billion. Tax-exempt money market funds increased by $2.75 billion." ICI's stats show Institutional MMFs decreasing $22.2 billion and Retail MMFs decreasing $0.4 billion in the latest week. Total Government MMF assets, including Treasury funds, were $6.479 trillion (82.4% of all money funds), while Total Prime MMFs were $1.234 trillion (15.7%). Tax Exempt MMFs totaled $148.6 billion (1.9%). It explains, "Assets of retail money market funds decreased by $375 million to $3.08 trillion. Among retail funds, government money market fund assets decreased by $796 million to $1.96 trillion, prime money market fund assets decreased by $1.87 billion to $986.57 billion, and tax-exempt fund assets increased by $2.29 billion to $136.37 billion." Retail assets account for 39.2% of the total, and Government Retail assets make up 63.6% of all Retail MMFs. They add, "Assets of institutional money market funds decreased by $22.19 billion to $4.78 trillion. Among institutional funds, government money market fund assets decreased by $21.70 billion to $4.52 trillion, prime money market fund assets decreased by $957 million to $247.02 billion, and tax-exempt fund assets increased by $461 million to $12.22 billion." Institutional assets accounted for 60.8% of all MMF assets, with Government Institutional assets making up 94.6% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have decreased by $59.9 billion to $8.290 trillion month-to-date in July (as of 7/22), assets reached an all-time high of $8.404 trillion on July 6. Assets increased $58.6 billion in June, $208.6 billion in May, decreased by $108.8 billion in April, $49.3 billion in March, increased $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose $63.7 billion last July. Note that `ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're almost $400 billion lower than Crane's asset series.
Reuters: Money Funds Turn Defensive
Last week, Reuters wrote, "US money market funds turn defensive with Fed rate outlook uncertain." The article says, "Money market funds are taking a more cautious approach in their portfolios, reflecting lingering uncertainty about the U.S. Federal Reserve's rate policy path, the latest industry data show. Weighted average maturity -- the average time until securities held by a money market fund mature -- fell to 38 days for the week ending July 10 for the Crane Money Fund Average, a broad industry measure, from 42 days a month ago. The same figure fell to 40 days this month from 44 days in June in the Crane 100 Money Fund Index, which tracks funds holding the vast majority of industry assets." It explains, "Fund managers typically shorten portfolio maturities when they anticipate higher interest rates. Shorter-dated securities mature more quickly, allowing managers to reinvest at higher yields if the Fed raises rates. Locking in three- or six-month Treasury bills ahead of a rate hike can leave investors stuck with lower yields as rates move higher. That caution comes as money market fund assets continue to attract cash. Assets climbed to a record of nearly $8 trillion in the first week of July, according to data from the Investment Company Institute." Reuters adds, "Managers have been deploying some of those inflows into floating-rate notes (FRNs), whose payouts change with the market, unlike typical fixed-rate debt. Treasury FRN holdings rose by $32 billion at the end of June to a record $523 billion.... Funds also increased their use of repurchase agreements, or repos, lending cash to dealers in exchange for securities that the dealers later buy back. As of June 30, repo balances had climbed by $68 billion to $3.06 trillion, representing 37.2% of total fund holdings, according to Crane Data.... [M]oney market funds face a difficult balancing act. 'Money market funds right now are caught between a rock and a hard place,' said [TD Securities'] Gennadiy Goldberg.... 'They want to be shorter in their weighted average maturities because of the risk of Fed rate hikes, but rates at the very front end of the curve, like repos, are still a bit soggy.'"
Weekly Money Fund Portfolio Holdings
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 July 17) includes Holdings information from 63 money funds (up 15 from two weeks ago), or $4.367 trillion (up from $3.629 trillion) of the $8.273 trillion in total money fund assets (or 52.8%) tracked by Crane Data. (Note: 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 July 13 News, "July MF Portfolio Holdings: Assets Flat; Repo Jumps, Treasuries Plunge.”) Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.968 trillion (up from $1.654 trillion two weeks ago), or 45.1%; Repurchase Agreements (Repo) totaling $1.572 trillion (up from $1.251 trillion two weeks ago), or 36.0%, and Government Agency securities totaling $463.5 billion (up from $383.1 billion two weeks ago), or 10.6%. Commercial Paper (CP) totaled $165.5 billion (up from $131.2 billion two weeks ago), or 3.8%. Certificates of Deposit (CDs) totaled $84.3 billion (up from $82.2 billion two weeks ago), or 1.9%. The Other category accounted for $72.0 billion or 1.6%, while VRDNs accounted for $41.1 billion or 0.9%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.968 trillion, Fixed Income Clearing Corp with $482.2B, the Federal Home Loan Bank with $293.6B, JP Morgan with $163.4B, RBC with $110.9B, Citi with $109.8B, Federal Farm Credit Bank with $105.1B, BNP Paribas with $102.2B, Wells Fargo with $86.7B and Goldman Sachs with $71.1B. The Ten Largest Funds tracked in our latest Weekly include: JPMorgan 100% US Trs MM ($343.5B), JPMorgan US Govt MM ($339.5B), Goldman Sachs FS Govt ($299.2B), Fidelity Inv MM: Govt Port ($285.6B), State Street Inst US Govt ($216.0B), Morgan Stanley Inst Liq Govt ($208.6B), BlackRock Lq FedFund ($192.2B), BlackRock Lq Treas Tr ($186.8B), Fidelity Inv MM: MM Port ($162.9B) and Dreyfus Govt Cash Mgmt ($160.8B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)
Crane 100 Index Back Up to 3.46%
Money fund yields (7-day, annualized, simple, net) were back up 1 bp to 3.46% on average during the week ended Friday, July 17 (as measured by our Crane 100 Money Fund Index), after decreasing 2 bps the week prior. Fund yields hadn't been below 3.5% since November 2022, and they are down from a recent high of 5.20% in November 2023. They should remain flat in coming days (and weeks) since the Fed left short-term rates unchanged five weeks prior. Yields were 3.44% on 5/31/26, 3.47% on 3/31, 3.58% on 12/31/25, 3.94% on 9/30/25, 4.13% on 6/30/25, 4.14% on 3/31/25 and 4.28% on average on 12/31/24. MMFs averaged 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 723), shows a 7-day yield of 3.37%, up 1 bp in the week through Friday. Prime Inst money fund yields were up 1 bp at 3.59% in the latest week. Government Inst MFs were up 1 bps at 3.45%. Treasury Inst MFs were up 1 bp at 3.44%. Treasury Retail MFs currently yield 3.21%, Government Retail MFs yield 3.18% and Prime Retail MFs yield 3.36%, Tax-exempt MF 7-day yields were up 59 bps to 2.13%. Money market mutual fund assets hit an all-time record high of $8.404 trillion on July 6. The previous record of $8.385 trillion was seen a week prior (7/1), according to our Money Fund Intelligence Daily. Assets have decreased $103.5 billion in the week through Friday, and they've decreased by $76.8 billion in July month-to-date (through 7/17). MMF assets increased by $58.6 billion in June, $208.6 billion in May, decreased by $108.8 billion in April, $49.3 billion in March, increased by $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose by $63.7 billion last July. Weighted average maturities were at 39 days for the Crane MFA and 40 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (7/17), just 168 money funds (out of 834 total) yield under 3.0% with $223.3 billion in assets, or 2.7%, while the vast majority (666) of funds yield between 3.00% and 3.99% ($8.050 trillion, or 97.3%). No funds yield over 4.0%. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.29%, after falling 1 bp eight weeks prior. The latest Brokerage Sweep Intelligence, with data as of July 17, shows one change over the past week. RW Baird lowered rates to 0.94% for accounts of $1K to $999K and to 1.98% for accounts of $5 million and greater. Four of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch, Morgan Stanley and Schwab.
Meeder Government MMF Rated AAA
A press release titled, "Meeder Government Money Market Fund Receives AAAmmf Rating from Fitch Ratings," tells us, "Meeder Investment Management announced ... that the Meeder Government Money Market Fund has received a AAAmmf rating from Fitch Ratings, the highest rating Fitch assigns to money market funds. The rating further strengthens the Fund's position as a cash management solution for public funds, institutions and other investors seeking liquidity, capital preservation and current income." It continues, "The Meeder Government Money Market Fund seeks to provide current income while preserving capital and maintaining liquidity through investments in high-quality, short-term U.S. government securities and fully collateralized repurchase agreements. The Fund operates as a government money market fund under Rule 2a-7 and maintains a stable $1.00 net asset value." Jon Azoff, Senior Vice President at Meeder Public Funds, comments, "Independent validation is important to the public entities and institutional investors we serve. This rating reflects the disciplined investment process, liquidity management and risk oversight that have long been central to the Fund's management." The release adds, "According to Fitch's July 2026 rating report, the AAAmmf rating reflects the agency's review of the Fund's investment guidelines, credit quality, diversification, duration parameters, liquidity profile and the capabilities of Meeder Asset Management as investment adviser. Fitch stated that the rating indicates an 'extremely strong capacity' to pursue the Fund's objectives of preserving capital and providing liquidity while limiting credit, market and liquidity risk."
ICI MMF Portfolio Holdings Summary
ICI recently 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. It tells us, "The Investment Company Institute (ICI) reports that, as of the final Friday in June, prime money market funds held 42.7 percent of their portfolios in daily liquid assets and 60.3 percent in weekly liquid assets, while government money market funds held 73.6 percent of their portfolios in daily liquid assets and 85.8 percent in weekly liquid assets." Prime DLA was down from 45.6% in May, and Prime WLA was down from 62.5%. Govt MMFs' DLA rose from 73.5% and Govt WLA was down from 85.9% for the previous month. ICI explains, "At the end of June, prime funds had a weighted average maturity (WAM) of 39 days and a weighted average life (WAL) of 59 days. Average WAMs and WALs are asset-weighted. Government money market funds had a WAM of 39 days and a WAL of 94 days." Prime WAMs and WALs were both down from the previous month, WAMs and WALs were both 2 days shorter. Govt WAMs and WALs were both down from the previous month, WAMs were 4 days shorter and WALs were 2 days shorter. Regarding Holdings by Region of Issuer, the release tells us, "Prime money market funds’ holdings attributable to the Americas rose from $767.99 billion in May to $774.10 billion in June. Government money market funds’ holdings attributable to the Americas rose from $5,967.89 billion in May to $6,034.19 billion in June." The Prime Money Market Funds by Region of Issuer table shows Americas-related holdings at $774.1 billion, or 63.1%; Asia and Pacific at $162.5 billion, or 13.2%; Europe at $275.3 billion, or 22.4%; and, Other (including Supranational) at $15.2 billion, or 1.3%. The Government Money Market Funds by Region of Issuer table shows Americas at $6.034 trillion, or 93.0%; Asia and Pacific at $127.5 or 2.0%; Europe at $305.1 billion, 4.7%, and Other (Including Supranational) at $20.3 billion, or 0.3%.
BlackRock Talks Tokenization on Call
BlackRock (BLK) reported its Q2'26 earnings yesterday, but talked very little about cash and money markets. (See the call transcript here.) CFO Martin Small says, "Cash net outflows of $7 billion in the quarter were due to redemptions from U.S. government funds, partially offset by the creation of bespoke liquidity solutions. Our customization capabilities and scale are driving sustained growth in cash management, with AUM up 10% from a year ago. We see the road to 2030 and beyond as presenting one of the largest expansions in capital markets growth and participation in history. The forces of demographics, growing retirement needs, generational wealth transfer, structural deficits, rapid innovation cycles." During the Q&A, the company was asked about tokenization. Small replies, "We see the operating environment in digital assets becoming more and more constructive; our strategy remains client led. We already have about $110 billion in AUM connected to digital assets. As part of our 2030 plan, we're aiming to make this a $500 million revenue business at BlackRock.... We have three things we're doing and tracking milestones against each. The first is to bridge traditional finance world and the decentralized finance markets. We're doing that through our digital assets products, IBIT, Ether, BUIDL. They all invest in digital native products and are the largest in their categories. They're driving meaningful growth in the traditional capital markets and bridging digital and traditional finance. Second, we want to be the stablecoin reserve manager of choice in the industry. We already manage $60 billion of reserves for Circle, representing about a quarter of the $300 billion stablecoin market. We see lots of growth ahead in stablecoin, and we want to be the reserve manager of choice. The third, and I think the most exciting for us, is tokenizing long-term investment products like Treasury funds, iShares ETFs, and even private markets in the long term." He explains, "To that end, two actions we've taken: We've recently filed two registration statements with the SEC for tokenized money market funds. One is a tokenized share class on Ethereum of an existing fund, and the other is a more digitally native strategy with additional features like daily dividend reinvestment and the like. We expect it to be accessible through multiple chains and to operate in an ecosystem where third parties support stablecoin-enabled subscription and redemptions so that the funding mechanism can happen all on-chain in the digital wallet. As stablecoins and digital wallets grow, clients will need high-quality reserve and liquidity products that can operate natively in that digital ecosystem. These filings that we've made recently are about bringing BlackRock's core cash management capabilities to where digital assets clients are already operating. They reinforce our broader ambition to help connect traditional capital markets and tokenized assets." Small comments, "The thing I'd observe is that there's 5 billion digital wallets in the world. When we talk about tokenized assets, tokenized assets are the spear tip into an entirely new distribution channel. Accessing an entire new class of investor, it's a pure organic growth opportunity for BlackRock. We have a whole scaled ecosystem of products that could, over time, be tokenized. When I think about $2 trillion-plus of crypto and digital wallets, when I think about another $300 billion of stablecoins all growing, these are all potential new investors with iShares. They're all potential new users of model portfolios, SMAs, and managed accounts in tokenized format. We want to build a digital wallet native asset manager. We're working with market participants, regulators in a way to do that creates growth and resiliency and brings more investors into the markets and more organic growth at BlackRock."
State Street IM: Patience Pays Again
State Street Investment Management (SSIM) recently posted a "Monthly Cash Review" titled, "Patience pays again." They write, "June was supposed to be a straightforward month for cash investors. The Federal Reserve was expected to sit still, money markets were behaving themselves, and summer was approaching. Naturally, markets looked at these perfectly reasonable expectations and decided to do something entirely different." The brief continues, "The month's main event was the first FOMC meeting chaired by Kevin Warsh. The Fed left rates unchanged at 3.50–3.75%, exactly as everyone expected. In fact, expectations were so unanimous that a surprise would probably have caused several trading desks to collectively throw their spreadsheets out the window. Instead, Chair Warsh chose a different form of entertainment. He dramatically shortened the Fed statement, reduced forward guidance, announced a series of task forces reviewing everything from communication strategy to the balance sheet, and effectively told markets, 'You'll just have to watch the data and figure it out yourselves.'" SSIM says, "Fortunately, cash investors had little reason to complain. Treasury bill yields moved to some of the most attractive levels seen in months. Three-month bills traded above 3.70% while six-month bills pushed above 3.90%. Investors responded by purchasing bills while simultaneously worrying that rates could move even higher. Credit markets were similar; opportunities were there but care was warranted. Markets can reprice fast and leave you with renewed risk. This is a time-honored tradition in the cash markets: finding an attractive yield and immediately becoming concerned that you're not getting enough of it." The piece adds, "Money market funds also enjoyed another exceptional month. Assets climbed to a record near $7.9 trillion as investors continued parking cash in what has become one of the most popular trades on Wall Street: getting paid to be patient. Institutional investors alone added roughly $100 billion in a single week. After years of earning close to nothing on cash, investors remain surprisingly enthusiastic about earning something.... As June closes, the outlook for cash investors remains remarkably attractive. Yields are compelling, liquidity is plentiful, and funding markets remain stable. The future path of monetary policy may be less certain than it was a month ago, but money market investors are currently being paid handsomely to wait for the answer. In a world filled with geopolitical drama, policy uncertainty, and endless forecasting mistakes, earning nearly 4% while remaining liquid may be the closest thing markets offer to a free lunch. And unlike most free lunches, this one actually pays you."
Crane 100 Index Retreats to 3.45%
Money fund yields (7-day, annualized, simple, net) were down 2 bps at 3.45% on average during the week ended Friday, July 10 (as measured by our Crane 100 Money Fund Index), after increasing 1 bp the week prior. Fund yields hadn't been below 3.5% since November 2022, and they are down from a recent high of 5.20% in November 2023. They should remain flat in coming days (and weeks) since the Fed left short-term rates unchanged four weeks prior. Yields were 3.44% on 5/31/26, 3.47% on 3/31, 3.58% on 12/31/25, 3.94% on 9/30/25, 4.13% on 6/30/25, 4.14% on 3/31/25 and 4.28% on average on 12/31/24. MMFs averaged 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 723), shows a 7-day yield of 3.36%, down 1 bp in the week through Friday. Prime Inst money fund yields were down 1 bp at 3.58% in the latest week. Government Inst MFs were down 2 bps at 3.44%. Treasury Inst MFs were down 1 bp at 3.43%. Treasury Retail MFs currently yield 3.20%, Government Retail MFs yield 3.17% and Prime Retail MFs yield 3.36%, Tax-exempt MF 7-day yields were down 38 bps to 1.55%. Money market mutual fund assets hit an all-time record high of $8.404 trillion on July 6. The previous record of $8.385 trillion was seen a week prior (7/1), according to our Money Fund Intelligence Daily. Assets have increased $62.2 billion in the week through Friday, and they've increased by $26.8 billion in July month-to-date (through 7/10). MMF assets increased by $58.6 billion in June, $208.6 billion in May, decreased by $108.8 billion in April, $49.3 billion in March, increased by $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose by $63.7 billion last July. Weighted average maturities were at 38 days for the Crane MFA and 40 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (7/10), just 173 money funds (out of 834 total) yield under 3.0% with $232.4 billion in assets, or 2.8%, while the vast majority (661) of funds yield between 3.00% and 3.99% ($8.145 trillion, or 97.2%). No funds yield over 4.0%. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.29%, after falling 1 bp seven weeks prior. The latest Brokerage Sweep Intelligence, with data as of July 10, shows no changes over the past week. Four of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch, Morgan Stanley and Schwab.
Fed Minutes on Rates, RRP, Rise
The latest "Minutes of the Federal Open Market Committee" state, "Regarding monetary policy expectations, the manager observed that market participants and respondents to the Open Market Desk Survey of Market Expectations (Desk survey) generally expected no change in the target range of the federal funds rate at the June FOMC meeting. Market- and survey-based measures of expected policy rates moved higher over the intermeeting period. In the Desk survey, the median of the modal paths of the federal funds rate implied no changes in the target range through the beginning of 2027 and one rate cut in the second quarter of next year. Market pricing suggested that one rate hike was priced for mid-2027, but the manager noted that these measures were likely boosted, in part, by term premiums." They also tell us, "The manager observed that money market conditions were generally stable, although conditions softened notably early in the intermeeting period before they partially rebounded. In particular, repurchase agreement (repo) rates dropped to 15 basis points below the interest rate on reserve balances in mid-May. Consistent with that drop, the effective federal funds rate declined 2 basis points, the first such change since November. There was modest take-up of the Federal Reserve's overnight reverse repurchase agreement operations on days when repo rates were especially low, confirming that those operations were effective in firming the floor under money market rates. Regarding the decline in repo rates early in the period, the manager noted several likely driving factors: Reserves increased following the seasonal low around the April tax date as the Treasury General Account dropped, reserve management purchases added reserves and reduced the bill supply available to the public, U.S. global systemically important banks likely increased intermediation capacity in response to regulatory changes earlier in the year, the demand for repo financing on the part of levered investors declined, and seasonal increases in cash investments of government-sponsored enterprises coincided with the lowest rates seen over the intermeeting period. The manager noted that, these developments notwithstanding, the level of reserves in the system appeared to remain within a range consistent with an ample supply." The Minutes say, "Over the intermeeting period, the market-implied expected path of the federal funds rate and nominal Treasury yields moved higher as stronger-than-expected economic data reinforced expectations that economic activity would remain resilient. The market-implied path of the policy rate over the latter half of this year increased during the intermeeting period, and related measures of uncertainty about the path of policy rose, partly reflecting a higher term premium. The rise in nominal Treasury yields, most notable at shorter maturities, reflected higher real rates. Short-term market-based measures of inflation compensation declined significantly but stayed at a slightly elevated level. Market-based measures of longer-term inflation compensation and survey-based measures of inflation expectations remained well anchored." They add, "Conditions in U.S. short-term funding markets remained stable. Aggregate bank reserves moved up following the previous period's tax receipt–driven decline. Money market rates ended the period slightly lower, on net, amid continued low bill supply. In support of the Committee's dual-mandate goals, all members agreed to maintain the target range for the federal funds rate at 3-1/2 to 3-3/4 percent and to reaffirm the FOMC's policy of maintaining ample reserves in the banking system. Members also agreed that the statement would not repeat the language that had suggested an easing bias regarding the likely direction of the Committee's future interest rate decisions. Members noted that there had been little change in the unemployment rate and solid growth in economic activity, but that inflation remained elevated relative to the Committee's 2 percent goal. Against this backdrop, members concurred that the post-meeting statement would convey the Committee's commitment to achieving its dual-mandate goals and emphasize that the Committee will deliver price stability."
The Investment Company Institute's latest weekly "Money Market Fund Assets" report shows money fund assets increasing $5.2 billion to a record $7.953 trillion, after jumping $47.7 billion the previous week. MMF assets are up by $881 billion, or 12.5%, over the past 52 weeks (through 7/8/26), with Institutional MMFs up $700 billion, or 16.8% and Retail MMFs up $180 billion, or 6.2%. Year-to-date in 2026, MMF assets are up by $220 billion, or 2.8%, with Institutional MMFs up $206 billion, or 4.4% and Retail MMFs up $14 billion, or 0.5%. ICI's weekly release says, "Total money market fund assets increased by $5.23 billion to $7.95 trillion for the week ended Wednesday, July 8, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $7.76 billion and prime funds increased by $112 million. Tax-exempt money market funds decreased by $2.64 billion.” ICI's stats show Institutional MMFs increasing $0.8 billion and Retail MMFs increasing $4.4 billion in the latest week. Total Government MMF assets, including Treasury funds, were $6.564 trillion (82.5% of all money funds), while Total Prime MMFs were $1.241 trillion (15.6%). Tax Exempt MMFs totaled $148.2 billion (1.9%). It explains, "Assets of retail money market funds increased by $4.41 billion to $3.09 trillion. Among retail funds, government money market fund assets increased by $3.13 billion to $1.97 trillion, prime money market fund assets increased by $2.70 billion to $989.04 billion, and tax-exempt fund assets decreased by $1.42 billion to $135.46 billion." Retail assets account for 38.9% of the total, and Government Retail assets make up 63.6% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $827 million to $4.86 trillion. Among institutional funds, government money market fund assets increased by $4.63 billion to $4.60 trillion, prime money market fund assets decreased by $2.59 billion to $252.27 billion, and tax-exempt fund assets decreased by $1.22 billion to $12.77 billion." Institutional assets accounted for 61.1% of all MMF assets, with Government Institutional assets making up 94.5% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have increased by $39.3 billion to $8.389 trillion month-to-date in July (as of 7/8), assets reached an all-time high of $8.404 trillion on July 6. Assets increased $58.6 billion in June, $208.6 billion in May, decreased by $108.8 billion in April, $49.3 billion in March, increased $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose $63.7 billion last July. Note that `ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're almost $400 billion lower than Crane's asset series.
BNY's Velis on T-Bills, Money Markets
BNY's John Velis and David Tam write on "Increasing T-Bill Issuance and Money Markets" in their latest "Short Thoughts." They tell us, "Increased T-bill supply for coming months has been identified as a driver for higher SOFR rates going forward, but we think there's a mitigating factor if the market continues to price out the most hawkish of expectations for the FOMC for the rest of 2026.... [T]he 3m term SOFR spread of the 3m T-bill rate has nearly halved since the post-June FOMC pop in hawkish pricing. We think that moderation in the labor data and short-term relief in consumer prices can keep these spreads from widening much further. Net bill issuance between July and September has averaged nearly $500bn over the past three years, while issuance in the April to June period has been negative by about $90bn.... [I]t's likely that Treasury's borrowing needs will require additional boosts to bill auctions over the next several months." The piece asks, "Will this push SOFR rates even higher, as many have argued? As mentioned above, we think that Fed expectations could soften.... The real question over the next few months, as expected T-bill issuance increases, is whether or not it can be comfortably absorbed by the market. There has been some reluctance by money market mutual funds (MMFs) to move out the curve and increase weighted average maturity, given still-present expectations of a rate hike, and this might have impacted demand for recent auctions. BNY adds, "However, with MMFs continuing to post record AUMs and cash preferences, we don't think the expected ramp up in supply will have too much trouble finding buys, especially if Fed rate expectations come in lower – a data driven process we'll be watching.... [R]eal money demand for T-bills is nearly inelastic, a robust result that held before, during and after the pandemic. We would be wary that any spread widening will be long-lived and expect the market to absorb increased supply."
Weekly Money Fund Portfolio Holdings
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 July 3) includes Holdings information from 48 money funds (down 27 from a week ago), or $3.629 trillion (down from $4.784 trillion) of the $8.315 trillion in total money fund assets (or 43.6%) tracked by Crane Data. (Note: 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 June 10 News, "June MF Portfolio Holdings: Assets Jump; Treasuries Surge, Repo Up.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.654 trillion (down from $2.079 trillion a week ago), or 45.6%; Repurchase Agreements (Repo) totaling $1.251 trillion (down from $1.759 trillion a week ago), or 34.5%, and Government Agency securities totaling $383.1 billion (down from $519.3 billion a week ago), or 10.6%. Commercial Paper (CP) totaled $131.2 billion (down from $179.8 billion a week ago), or 3.6%. Certificates of Deposit (CDs) totaled $82.2 billion (down from $99.7 billion a week ago), or 2.3%. The Other category accounted for $65.5 billion or 1.8%, while VRDNs accounted for $62.8 billion or 1.7%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.654 trillion, Fixed Income Clearing Corp with $432.7B, the Federal Home Loan Bank with $255.7B, JP Morgan with $132.1B, Citi with $100.0B, Wells Fargo with $91.4B, RBC with $79.5B, BNP Paribas with $72.2B, Federal Farm Credit Bank with $66.8B and Bank of America with $41.7B. The Ten Largest Funds tracked in our latest Weekly include: JPMorgan 100% US Trs MM ($328.5B), JPMorgan US Govt MM ($328.0B), Goldman Sachs FS Govt ($281.3B), Fidelity Inv MM: Govt Port ($280.8B), Morgan Stanley Inst Liq Govt ($209.9B), BlackRock Lq FedFund ($190.1B), BlackRock Lq Treas Tr ($185.5B), Fidelity Inv MM: MM Port ($160.4B), Dreyfus Govt Cash Mgmt ($155.7B) and Allspring Govt MM ($134.3B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)
Crane 100 Index Inches Up to 3.47%
Money fund yields (7-day, annualized, simple, net) were up 1 bp at 3.47% on average during the week ended Thursday, July 2 (as measured by our Crane 100 Money Fund Index), after going unchanged the week prior. Fund yields hadn't been below 3.5% since November 2022, and they are down from a recent high of 5.20% in November 2023. They should remain flat in coming days (and weeks) since the Fed left short-term rates unchanged three weeks prior. Yields were 3.44% on 5/31/26, 3.47% on 3/31, 3.58% on 12/31/25, 3.94% on 9/30/25, 4.13% on 6/30/25, 4.14% on 3/31/25 and 4.28% on average on 12/31/24. MMFs averaged 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 716), shows a 7-day yield of 3.37%, up 1 bp in the week through Thursday. Prime Inst money fund yields were unchanged at 3.59% in the latest week. Government Inst MFs were up 1 bp at 3.46%. Treasury Inst MFs were up 1 bp at 3.44%. Treasury Retail MFs currently yield 3.21%, Government Retail MFs yield 3.19% and Prime Retail MFs yield 3.38%, Tax-exempt MF 7-day yields were down 37 bps to 1.93%. Money market mutual fund assets hit an all-time record high of $8.385 trillion on July 1. The previous record of $8.370 trillion was seen two weeks prior (6/16), according to our Money Fund Intelligence Daily. Assets have decreased $46.2 billion in the week through Thursday, and they've decreased by $35.4 billion in July month-to-date (through 7/2). MMF assets increased by $58.6 billion in June, $208.6 billion in May, decreased by $108.8 billion in April, $49.3 billion in March, increased by $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose by $63.7 billion last July. Weighted average maturities were at 39 days for the Crane MFA and 42 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Thursday (7/2), just 168 money funds (out of 827 total) yield under 3.0% with $223.6 billion in assets, or 2.7%, while the vast majority (659) of funds yield between 3.00% and 3.99% ($8.091 trillion, or 97.3%). No funds yield over 4.0%. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.29%, after falling 1 bp six weeks prior. The latest Brokerage Sweep Intelligence, with data as of July 2, shows no changes over the past week. Four of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch, Morgan Stanley and Schwab.
ICI: MMFs Hit Record $7.95 Trillion
The Investment Company Institute's latest weekly "Money Market Fund Assets" report shows money fund assets jumping $47.7 billion to a record $7.948 trillion, after falling $18.9 billion the previous week. MMF assets are up by $870 billion, or 12.3%, over the past 52 weeks (through 7/1/26), with Institutional MMFs up $691 billion, or 16.6% and Retail MMFs up $179 billion, or 6.1%. Year-to-date in 2026, MMF assets are up by $215 billion, or 2.8%, with Institutional MMFs up $205 billion, or 4.4% and Retail MMFs up $10 billion, or 0.3%. ICI's weekly release says, "Total money market fund assets increased by $47.71 billion to $7.95 trillion for the week ended Wednesday, July 1, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $34.11 billion and prime funds increased by $11.36 billion. Tax-exempt money market funds increased by $2.24 billion.” ICI's stats show Institutional MMFs increasing $44.1 billion and Retail MMFs increasing $3.6 billion in the latest week. Total Government MMF assets, including Treasury funds, were $6.556 trillion (82.5% of all money funds), while Total Prime MMFs were $1.241 trillion (15.6%). Tax Exempt MMFs totaled $150.9 billion (1.9%). It explains, "Assets of retail money market funds increased by $3.60 billion to $3.09 trillion. Among retail funds, government money market fund assets increased by $1.12 billion to $1.96 trillion, prime money market fund assets increased by $1.25 billion to $986.34 billion, and tax-exempt fund assets increased by $1.23 billion to $136.88 billion." Retail assets account for 38.8% of the total, and Government Retail assets make up 63.6% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $44.11 billion to $4.86 trillion. Among institutional funds, government money market fund assets increased by $32.99 billion to $4.59 trillion, prime money market fund assets increased by $10.11 billion to $254.86 billion, and tax-exempt fund assets increased by $1.01 billion to $13.99 billion." Institutional assets accounted for 61.2% of all MMF assets, with Government Institutional assets making up 94.5% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have increased by $35.0 billion to a record high $8.385 trillion month-to-date in July (as of 7/1). Assets increased $58.6 billion in June, $208.6 billion in May, decreased by $108.8 billion in April, $49.3 billion in March, increased $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose $63.7 billion last July. Note that `ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're almost $400 billion lower than Crane's asset series.
PFII: What's in Store for Rest of 2026
Marty Margolis's latest Public Funds Investment Institute posting is titled, "Halftime: What's in Store for the Balance of 2026?" It explains, "Last week's Crane Money Fund Symposium brought together portfolio managers who invest assets in the $8 trillion money market fund industry along with those who invest portfolios for the major banks. It's a small number of people whose views on the economy and investment markets are incredibly important in setting the course for short-term interest rates. The symposium came on the heels of the first Federal Open Market Committee meeting chaired by Kevin Warsh which seemed to mark the beginning of a new direction for monetary policy. The timing and the audience provided an opportunity to consider the path of the short-term fixed income market for the balance of 2026." It summarizes, "With that in mind here are key themes that came out of the meeting: The Fed Will Raise Rates. The consensus of portfolio managers seemed to be for one or two 25 basis point increases in the Federal Reserve's target rate (currently 3.50%-3.75%) over the balance of 2026. Bank and broker economists at the symposium, many of whom are regularly on Bloomberg, CNBC and on investor roadshows had a wider dispersion of views, from forecasts of unchanged rates to those who foresee three increases. Portfolio managers leaned toward the mild side. One or two increases would be a big change from the outlook early in 2026, when federal funds futures contracts predicted an overnight rate of 3% or less by year-end, but persistent inflation and a slow but positive expansion of economic activity have led to the adjustment." The piece also says, "A Surge in Treasury Bill Supply Will Dominate the Second Half of 2026," stating, "Treasury is expected to issue $800 billion(!) of bills over the next six months to fund the federal deficit. It will increase outstanding bill supply by about 12%. This may seem like a striking figure, but it's in line with issuance last year. If you are a buyer/investor more supply is a positive as it should put modest upward pressure on yields." Margolis updste adds, "Market participants expect that money funds will continue to absorb much of the supply with their assets extending the pace of recent growth. Bill issuance over the past several years has been matched by growth in money fund assets." Finally, the article tells us, "The Prospect of More Bills Could Put Modest Upward Pressure on Money Market Yields." It says, "Bank deposit rates and commercial paper rates could rise to add spread to comparable bill rates. Financial institutions will want to assure funding in the face of the bill onslaught and also position for the end of the year when funding normally gets more challenging. Some evidence of spread widening already has shown up in levels posted by banks for maturities of six months or more, and this spread widening could continue in coming weeks.... Market participants are buzzing about stable coins, tokenized money fund shares and money fund ETFs but these innovations remain on the fringe. Either the technologies are still in formation, or the business case is lacking, and they are not seen as impacting the markets, at least in the short run."
Yahoo on Invesco Stablecoin Reserves
A posting on Yahoo Finance, "Invesco Targets Stablecoin Reserves With New Tokenized Money Market Fund," explains, "Invesco ($IVZ) is moving deeper into the stablecoin reserve market with a new tokenized money market fund aimed at issuers looking for compliant, yield-bearing cash management. The $2.45 trillion asset manager filed an amended registration statement with the Securities and Exchange Commission on June 24 to add the Invesco Stablecoin Reserves Onchain Fund to its Short-Term Investments Trust. The fund does not yet have a ticker and is expected to become effective about 60 days after the filing, unless regulators intervene." The piece says, "Superstate's role gives the product its onchain layer. The filing describes a blockchain-integrated recordkeeping system that combines off-chain book-entry records with digital representations of fund shares on designated public blockchains. Wallets must be registered and verified, keeping the product closer to permissioned institutional infrastructure than open crypto trading." The story adds, "The filing adds Invesco to a growing group of Wall Street firms positioning money market funds as stablecoin reserve infrastructure. The category has become more attractive as stablecoin legislation gives issuers a clearer map for eligible reserves, while tokenized fund platforms try to make those assets usable inside faster settlement and collateral workflows. Invesco already had a link to the sector after taking over day-to-day portfolio management of Superstate's USTB tokenized Treasury fund earlier this year." See the SEC filing for Invesco Stablecoin Reserves Onchain Fund here. For more on Stablecoin Reserve funds, see these Crane Data News stories: "Fidelity Reserves Digital Fund Goes Live" (6/23/26), "State Street Stablecoin Reserves Goes Live" (6/17/26), "Federated MMR Digital Treasury Fund" (6/10/26), "BNY Files for Dreyfus On-Chain Liquidity Fund for Stablecoin Reserves" (5/22/26), "Fidelity Files for Reserves Digital Fund, 5th Stablecoin Reserve MMF" (3/23/26), "Dec. MFI: MMFs Hit $8.0T, Top 10; JPM '26 Outlook; Stablecoin Reserves" (12/5/25), "State Street Files for Stablecoin Reserves MMF; BNY's Stephanie Pierce" (11/19/25), "BNY Stablecoin Reserves Goes Live; ICI: Assets Eke Out Record $7.5T" (11/14/25),"BNY's Vince on Q3 Call: Money Market Evolution, Dreyfus, Stablecoins" (10/22/25), "BlackRock Breaks $1 Trillion in Money Funds; Offers Stablecoin Reserve" (10/17/25), "Sept. MFI: Assets Break $7.6T; Stablecoin Reserves; JPM on Offshore MFs" (9/8/25), "BNY Dreyfus to Launch Stablecoin Reserves Fund; Joins Goldman, Circle" (8/20) and "Goldman Files to Launch Stablecoin Reserves Fund; Circle Q2 Earnings" (8/13/25).
