Link of The Day
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 March 28) includes Holdings information from 57 money funds (down 10 from a week ago), or $3.509 trillion (down from $3.964 trillion) of the $7.355 trillion in total money fund assets (or 47.7%) 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 March 12 News, "March Money Fund Portfolio Holdings: Repo Surges, Treasuries Plunge.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.644 trillion (down from $1.833 trillion a week ago), or 46.9%; Repurchase Agreements (Repo) totaling $1.231 trillion (down from $1.372 trillion a week ago), or 35.1%, and Government Agency securities totaling $294.0 billion (down from $326.0 billion), or 8.4%. Commercial Paper (CP) totaled $140.9 billion (down from a week ago at $174.1 billion), or 4.0%. Certificates of Deposit (CDs) totaled $82.3 billion (down from $101.4 billion a week ago), or 2.3%. The Other category accounted for $78.9 billion or 2.2%, while VRDNs accounted for $37.4 billion, or 1.1%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.644 trillion (46.9% of total holdings), Fixed Income Clearing Corp with $355.1B (10.1%), the Federal Home Loan Bank with $192.2 billion (5.5%), JP Morgan with $125.0B (3.6%), BNP Paribas with $80.9B (2.3%), Citi with $76.4B (2.2%), RBC with $73.2B (2.1%), Federal Farm Credit Bank with $67.9B (1.9%), Wells Fargo with $61.2B (1.7%) and the Federal Reserve Bank of New York with $61.1B (1.7%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($294.2B), Goldman Sachs FS Govt ($265.7B), JPMorgan 100% US Treas MMkt ($250.7B), Fidelity Inv MM: Govt Port ($234.3B), Morgan Stanley Inst Liq Govt ($176.9B), State Street Inst US Govt ($165.8B), BlackRock Lq FedFund ($163.1B), BlackRock Lq Treas Tr ($153.0B), Fidelity Inv MM: MM Port ($151.6B) and Dreyfus Govt Cash Mgmt ($132.9B). (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 Inch Up to 4.14%
Money fund yields (7-day, annualized, simple, net) were one basis point higher to 4.14% on average during the week ended Friday, March 28 (as measured by our Crane 100 Money Fund Index), after falling 1 bp last week and falling 1 bp the week prior. Fund yields have digested all of the Federal Reserve's 25 basis point cut from December 18, so they should remain relatively flat until the Fed moves rates again. They've declined by 92 bps since the Fed first cut its Fed funds target rate by 50 bps on Sept. 18, and they've declined by 49 bps since the Fed cut rates by 1/4 point on 11/7. Yields were 4.16% on 2/28/25, 4.19% on 1/31/25, 4.28% on average on 12/31/24, 4.45% on 11/30/24, 4.65% on 10/31, 4.75% on 9/30, 5.10% on 8/31, 5.13% on 7/31 and 6/28, 5.14% on 3/31 and 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 683), shows a 7-day yield of 4.04%, up one bp in the week through Friday. Prime Inst money fund yields were up one bp to 4.28% in the latest week. Government Inst MFs were up 2 bps to 4.15%. Treasury Inst MFs were up one bp to 4.09%. Treasury Retail MFs currently yield 3.85%, Government Retail MFs yield 3.85%, and Prime Retail MFs yield 4.04%, Tax-exempt MF 7-day yields were down 21 bps to 2.71%. Assets of money market funds fell by $167 million last week to $7.355 trillion, according to Crane Data's Money Fund Intelligence Daily. For the month of March, MMF assets rose by $33.7 billion, after increasing by $94.2 billion in February, $52.8 billion in January, $110.9 billion in December, $200.5 billion in November, $97.5 billion in October and $149.8 billion in September. Weighted average maturities were unchanged at 36 days for the Crane MFA and 37 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (3/28), 105 money funds (out of 795 total) yield under 3.0% with $104.7 billion in assets, or 1.4%; 241 funds yield between 3.00% and 3.99% ($1.340 trillion, or 18.2%), 449 funds yield between 4.0% and 4.99% ($5.910 trillion, or 80.4%) and following the recent rate cut there continue to be zero funds yielding 5.0% or more. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.41%. The latest Brokerage Sweep Intelligence, with data as of March 28, shows no changes over the past week. 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.
Treasurers.org: Money Funds in Focus
Treasurers.org recently published the article, "Liquidity outlook: money market funds in focus," which is subtitled, "MMFs will remain popular in 2025, offering yield and liquidity but credit processes must remain rigorous, according to Aviva Investors' Alastair Sewell." It states, "In an increasingly varied macro-economic environment, cash management is as important as ever. Many corporate treasurers use money market funds (MMFs, also known as liquidity funds) as a tool for managing their cash. MMFs aim to preserve capital, provide on-demand liquidity and deliver a competitive yield. But what can we expect from MMFs in 2025? While central bank rates -- and hence liquidity fund yields -- may not match the highs of 2024, we still expect levels of cash income to be healthy in 2025 and certainly well above the lows of the 2010s. 'Step-out' strategies, such as 'standard' MMFs and ultra-short bond funds, could be useful tools this year to help investors achieve higher overall blended yields while maintaining good levels of liquidity." Sewell comments, "Liquidity fund managers always seek to manage liquidity levels prudently, so they can deliver on their objective of providing timely liquidity. Even with flows being broadly positive during 2024, liquidity funds generally maintained high levels of liquidity, well above regulatory minima. But despite these levels of prudence, US authorities increased minimum liquidity requirements for US funds and the UK proposed increases, too. Whether Europe follows suit remains to be seen." The article continues, "Most major central banks are in a rate-cutting mode. The key challenge for liquidity fund portfolio managers will be in predicting the timing and magnitude of future rate changes and hence the relative value of securities with different maturities. In other words, it's all going to be about the shape of the short-term yield curve. Looking at 2025, market participants have adjusted their expectations. Median forecasts from economists do, however, still point to cuts ahead, with inflation developments representing a key factor in the outlook. The more fundamental point is that there is no current indication of rates falling back to the ultra-low levels of the 2010s. With inflation falling, and below central bank base rates, the yields on liquidity funds should be positive in real terms." It adds, "There are options for those investors seeking to generate higher yields in a declining rate environment. For investors unwilling to step outside the regulated liquidity fund perimeter, 'standard' MMFs can be an option. These operate with longer weighted average maturities than 'short-term' MMFs, and can therefore generate potentially higher yields, especially as rates fall. Short-term bond funds come in many shapes and sizes. Many will have material allocations to short-dated corporate bonds, potentially rated in the 'BBB' category. We believe there are assets with more stable profiles available that can deliver incrementally higher yields." Finally, Sewell writes, "We think it highly likely the European Commission (EC) will put forward proposals to change the MMF regulation in 2025. There are two key topics we expect to be raised. First, 'delinking' or a removal of the link between weekly liquid assets and the potential imposition of liquidity fees and gates. The EC has already indicated it is minded to remove this link as it proved to have unintended consequences. That's a positive. Second, 'increased liquidity requirements'. The US Securities and Exchange Commission mandated higher liquidity levels and the FCA in the UK has called for it. While the EC has stated that current levels are adequate, we see pressure from multiple quarters to demand more. This should make liquidity funds safer, but then again, the evidence shows that even in severe scenarios current liquidity levels have proven adequate to date. More fundamentally, it could reduce the yield liquidity funds can generate."
Returns on Cash Remain Compelling
The Boston Globe asks in a brief titled, "Cash on the barrelhead," "Is there a sliver of a silver lining to this five-week stock market slide? Yes -- if you're sitting on extra cash and would like a safe place to stash it at a decent interest rate. Thanks to a cautious Federal Reserve and lingering economic uncertainty, returns on cash-like holdings remain compelling. Though rates on savings accounts, money market funds, and short-term Treasuries have dipped from their 2023 highs, they're still hanging in around 4 to 4.5 percent -- a far cry from the paltry yields of the pre-inflation era." Discussing "Why it matters," they tell us, "After last year's full-point of rate cuts, the Fed has pumped the brakes. Chair Jerome Powell signaled last week that officials will wait to see how inflation and President Trump's economic policies play out before making another move. `That means short-term yields aren't dropping much anytime soon, leaving savers with a rare window to earn something for parking cash.... Money market mutual funds are slightly lower [than a handful of high-yield bank accounts], with an `average 7-day yield of 4.13 percent among the 100 largest, according to Pete Crane of Crane Data. While these funds aren't insured, losses are extremely rare. The current leader: Morgan Stanley Investment Management's $3.7 billion fund at 4.41 percent. Treasuries remain the gold standard for safety: 1-year bills are yielding about 4.1 percent, and 2-year notes are close behind at 4 percent." They add, "Yields on savings accounts and money funds can (and do) change. My Marcus account has fallen from 4.5 percent to 3.75 percent since last spring. CDs, on the other hand, lock in the rate -- at the cost of liquidity. Marcus now offers 4.5 percent only if you're willing to commit for 14 months.... Cash isn't a growth engine -- it's a buffer. Long term, stocks win, said Raj Sharma at Merrill Lynch Private Wealth Management in Boston. But lately, investors are spooked by the potential inflationary bite of Trump's new tariffs and government cutbacks."
Daily HODL on Uninsured Deposits
The Daily HODL writes "JPMorgan Chase, Wells Fargo and Bank of America Customers Holding $2,620,000,000,000 in Uninsured Deposits As Americans Pour Cash Into Unprotected Accounts." They explain, "New numbers show customers at JPMorgan Chase, Wells Fargo and Bank of America are piling money into unprotected accounts. The lenders' quarterly Call Reports, submitted to the Federal Financial Institutions Examination Council (FFIEC), show the banks' customers now collectively hold $2.62 trillion in uninsured cash." The piece continues, "That breaks down to $1.15 trillion in uninsured deposits at JPMorgan Chase, $652.7 billion at Wells Fargo and $821.9 billion at Bank of America. US banks and the FDIC promise customers that deposits up to the amount of $250,000 will always be covered in the event of a collapse -- but anything in excess is not insured. That leaves a serious pile of cash at risk -- money from businesses, retirees, and families that could vanish overnight if a bank fails. According to the Federal Deposit Insurance Corporation (FDIC), uninsured deposits at US banks grew across all asset size groups in the fourth quarter of 2024, based on reports from 4,487 FDIC-insured institutions. Uninsured deposits surged by $126.6 billion, significantly outpacing the $43.7 billion rise in insured deposits during the same period." They add, "In 2023, the FDIC protected all uninsured depositors at the disastrous, sudden failure of Silicon Valley Bank (SVB) by invoking a systemic risk exception, ensuring no losses despite $100 billion-plus in uninsured funds. In contrast, at smaller banks like Republic First Bank, which failed in July of last year, uninsured depositors faced losses and received only partial recovery from asset sales since no systemic risk was declared."
OFR Extends Repo Data Reporting
A press release titled, "Office of Financial Research Extends to June 30, 2025 the Compliance Date for Rule on Non-centrally Cleared Bilateral Repurchase Agreement Data Collection" tells us, "The Office of Financial Research (OFR) ... announced it will extend by 90 days the compliance date for Category 2 covered reporters under a rule applying to non-centrally cleared bilateral repo (NCCBR) transactions in the U.S. repurchase agreement market. The new compliance date will be June 30, 2025 for Category 2 covered reporters whose compliance date otherwise would have been April 1, 2025. The final rule was published on May 6, 2024. This data collection requires daily reporting to OFR by certain brokers, dealers, and other financial companies with large exposures to NCCBR transactions. The Notice will appear in the Federal Register." It adds, "The OFR helps promote financial stability by looking across the financial system to measure and analyze risks, perform essential research, and collect and standardize financial data, principally to support the Financial Stability Oversight Council and its member agencies."
Crane 100 Lower Again to 4.13%
Money fund yields (7-day, annualized, simple, net) were one basis point lower to 4.13% on average during the week ended Friday, March 21 (as measured by our Crane 100 Money Fund Index), after falling 1 bp last week and falling 1 bp the week prior. Fund yields have digested all of the Federal Reserve's 25 basis point cut from December 18, but they may inch down another basis point or 2 lower in coming days. They've declined by 93 bps since the Fed first cut its Fed funds target rate by 50 bps on Sept. 18, and they've declined by 50 bps since the Fed cut rates by 1/4 point on 11/7. Yields were 4.16% on 2/28/25, 4.19% on 1/31/25, 4.28% on average on 12/31/24, 4.45% on 11/30/24, 4.65% on 10/31, 4.75% on 9/30, 5.10% on 8/31, 5.13% on 7/31 and 6/28, 5.14% on 3/31 and 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 683), shows a 7-day yield of 4.03%, down one bps in the week through Friday. Prime Inst money fund yields were down one bp to 4.27% in the latest week. Government Inst MFs were down 1 bp to 4.13%. Treasury Inst MFs were down one bp to 4.08%. Treasury Retail MFs currently yield 3.85%, Government Retail MFs yield 3.83%, and Prime Retail MFs yield 4.03%, Tax-exempt MF 7-day yields were up 22 bps to 2.93%. Assets of money market funds rose by $28.8 billion last week to $7.355 trillion, according to Crane Data's Money Fund Intelligence Daily. For the month of February, MMF assets rose by $94.2 billion, after increasing by $52.8 billion in January, $110.9 billion in December, $200.5 billion in November, $97.5 billion in October and $149.8 billion in September. Weighted average maturities were unchanged at 36 days for the Crane MFA and 37 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (3/21), 63 money funds (out of 795 total) yield under 3.0% with $32.7 billion in assets, or 0.4%; 287 funds yield between 3.00% and 3.99% ($1.436 trillion, or 19.5%), 445 funds yield between 4.0% and 4.99% ($5.886 trillion, or 80.0%) and following the recent rate cut there continue to be zero funds yielding 5.0% or more. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.41%. The latest Brokerage Sweep Intelligence, with data as of March 21, shows no changes over the past week. 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.
Vanguard Survey: Savers' Rates Lag
A news release titled, "Vanguard Survey Reveals Savings Blind Spot: Idle Cash," states, "Vanguard's new national consumer survey revealed a startling savings blind spot: idle cash. While nearly 90% of Americans currently save or plan to save for short-term goals, 60% do not completely understand how interest rates impact their savings. This translates into most Americans putting their cash savings into vehicles that are slow growing—often trailing inflation. In fact, 57% of survey respondents report that their savings are earning less than 3% interest, including 24% earning less than 1%." Vanguard's Matt Benchener comments, "Americans are not earning the returns they deserve on their hard-earned cash. While the overwhelming majority are saving, most aren't saving in vehicles where their cash is getting a fair return. Vanguard is on a mission to change that with our Cash Plus account, potentially allowing Americans to earn eight times more than with a traditional bank savings account. With inflation and fluctuating interest rates impacting purchasing power, it's more important than ever to ensure that consumers understand how to safeguard their savings. It's time to start thinking beyond your bank." The release tells us, "While Americans are building their short-term savings for different purposes, like vacations (38%), new cars (31%), and unexpected home repairs (24%), many share one thing in common: their savings accounts aren't pulling their weight. More than half of respondents (54%) save in traditional bank savings accounts or checking accounts (39%), where average interest rates are roughly 0.41% compared to rates such as 3.65% in other savings vehicles, like Vanguard's Cash Plus account. This might contribute to the fact that 72% of Americans are not completely confident they will reach their savings goals over the next two years. Although Americans are not capitalizing on the interest their savings could earn, they recognize the need to change their savings behaviors. Sixty six percent of respondents plan to adjust their current savings strategy in the next year, citing inflation (44%) as the biggest driver of this decision. But nearly one-third of Americans don’t know how to start making those changes." Vanguard's Andrew Kadjeski adds, "By leveraging accounts with competitive yields and establishing intentional savings strategies, Americans can make their money work harder. We designed the Cash Plus account to give Americans a simple, effective way to save with intention and view their savings alongside their long-term investments." Finally, Vanguard's item says, "Cash Plus is currently yielding 3.65% APY, compared to the average bank savings account yield of 0.41%. In addition to a better yield, Cash Plus offers FDIC coverage, easy access to account and routing numbers for bill pay and direct deposit, connectivity to payment apps like PayPal and Venmo, and no minimum balance requirements. Along with Cash Plus, Vanguard also offers a full suite of liquidity solutions including money market and ultra-short-term bond funds."
MMF Assets Fall on March 15 Taxes
ICI published its latest "Money Market Fund Assets" report on Thursday. The weekly series shows money fund assets falling $21.8 billion to $7.002 trillion, after falling $1.4 billion the week prior, but rising $51.2 billion two weeks prior. Money fund assets have risen in 22 of the last 33, and 33 of the last 48 weeks, increasing by $698.7 billion (or 11.1%) since the Fed cut on 9/18/24 and increasing by $1.025 trillion (or 17.1%) since 4/24/24. MMF assets are up by $956 billion, or 15.6%, in the past 52 weeks (through 3/19/25), with Institutional MMFs up $488 billion, or 13.1% and Retail MMFs up $467 billion, or 19.6%. Year-to-date, MMF assets are up by $152 billion, or 2.2%, with Institutional MMFs up $20 billion, or 0.5% and Retail MMFs up $132 billion, or 4.8%. ICI's weekly release says, "Total money market fund assets decreased by $21.74 billion to $7.00 trillion for the week ended Wednesday, March 19... Among taxable money market funds, government funds decreased by $30.56 billion and prime funds increased by $5.39 billion. Tax-exempt money market funds increased by $3.43 billion.” ICI's stats show Institutional MMFs decreasing $30.7 billion and Retail MMFs increasing $9.0 billion in the latest week. Total Government MMF assets, including Treasury funds, were $5.735 trillion (81.9% of all money funds), while Total Prime MMFs were $1.134 trillion (16.2%). Tax Exempt MMFs totaled $134.1 billion (1.9%). ICI's release explains, "Assets of retail money market funds increased by $8.96 billion to $2.87 trillion. Among retail funds, government money market fund assets increased by $417 million to $1.82 trillion, prime money market fund assets increased by $5.84 billion to $921.70 billion, and tax-exempt fund assets increased by $2.70 billion to $122.78 billion." Retail assets account for well over a third of total assets, or 40.9%, and Government Retail assets make up 63.6% of all Retail MMFs. They add, "Assets of institutional money market funds decreased by $30.71 billion to $4.14 trillion. Among institutional funds, government money market fund assets decreased by $30.98 billion to $3.91 trillion, prime money market fund assets decreased by $455 million to $211.90 billion, and tax-exempt fund assets increased by $725 million to $11.30 billion." Institutional assets accounted for 59.1% 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 risen by $18.1 billion in March through 3/19/25, hitting a record high $7.371 trillion last week (3/11). Assets rose by $94.2 billion in February, $52.8 billion in January, $110.9 billion in December, $200.5 trillion in November, $97.5 billion in October, $149.8 billion in September, $109.7 billion in August, $16.6 billion in July, $15.7 billion in June and $91.4 billion in May. They declined by $15.8 billion in April and $68.8 billion in March 2024. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $330 billion lower than Crane's asset series.
Fed Holds Funds Rate at 4.25-4.50%
A release titled, "Federal Reserve issues FOMC statement" tells us, "Recent indicators suggest that economic activity has continued to expand at a solid pace. The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid. Inflation remains somewhat elevated. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty around the economic outlook has increased. The Committee is attentive to the risks to both sides of its dual mandate." They comment, "In support of its goals, the Committee decided to maintain the target range for the federal funds rate at 4-1/4 to 4-1/2 percent. In considering the extent and timing of additional 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 will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities. Beginning in April, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $25 billion to $5 billion. The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion. The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective." The FOMC adds, "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."
SSGA Asks "Why Is Cash Piling Up?"
State Street Global Advisors' (SSGA) latest "Monthly Cash Review March 2025 (USD)" asks, "Why Is Cash Piling Up?" Author Will Goldthwait explains, "As we move through a period of extreme uncertainty in Washington D.C., it is no surprise that the markets are showing signs of anxiety. The political chaos, coupled with shifting fiscal policies, is causing volatility across many sectors. Even the slightest shift in sentiment seems to shake investor confidence and cause tremors in the market. Yet, amid all this uncertainty, one thing remains clear: investors are flocking to the safety of cash." He continues, "Positive flows continue. MMFs are up by approximately $300 billion, or 5%, since the start of December. LGIPs are up almost $50 billion, 13% from a year ago. Ultra-short-term ETFs are up almost $63 billion, or 32% since last summer, according to the Investment Company Institute (ICI). So, why is so much cash piling up? Part of the answer lies in the extraordinary rally we have witnessed in the equity market over the past year and the continued strength in the credit markets (corporate debt). Investors appear to be favoring cash: safe, liquid assets, and taking a few 'chips off the table.' I'm often asked, 'When will the money start to flow out of cash?' It seems unlikely that we will see that shift anytime soon -- not until we witness a major sell-off and/or a recession will we likely see a significant drawdown in cash." He adds, "While these money market inflows are undoubtedly significant, there has been talk that the broader liquidity environment is starting to tighten. The General Collateral Repo Financing Rate (GCR) and the Secured Overnight Financing Rate (SOFR), key indicators of money market rates, are beginning to move higher in yield vs. the Fed's target rate range. As the Fed continues its quantitative tightening program (QT), their reverse repo program (RRP) continues to wind down and we have seen a sharp decline in its usage from the peak of over $2 trillion in 2022 and 2023. Recently the balance dropped to a new low of $63 billion, although month-end funding pressures persist. December, January and February saw the RRP balance spike to $473 billion, $187 billion and $234 billion, respectively. This is not atypical as dealers tend to reduce their balance sheets at month-ends, but could these spikes also be implying that other funding pressures are emerging? Realistically? Most likely not. But what is interesting is the spikes emerging in the GCR and SOFR markets, as these may be better indicators of potential stressors."
Crane 100 Creeps Down to 4.14%
Money fund yields (7-day, annualized, simple, net) were one basis point lower to 4.14% on average during the week ended Friday, March 14 (as measured by our Crane 100 Money Fund Index), after falling 1 bp last week and going unchanged the week prior. Fund yields have digested all of the Federal Reserve's 25 basis point cut from December 18, but they may inch down another basis point or 2 lower in coming days. They've declined by 92 bps since the Fed first cut its Fed funds target rate by 50 bps percent on Sept. 18, and they've declined by 49 bps since the Fed cut rates by 1/4 point on 11/7. Yields were 4.16% on 2/28/25, 4.19% on 1/31/25, 4.28% on average on 12/31/24, 4.45% on 11/30/24, 4.65% on 10/31, 4.75% on 9/30, 5.10% on 8/31, 5.13% on 7/31 and 6/28, 5.14% on 3/31 and 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 683), shows a 7-day yield of 4.04%, down one bps in the week through Friday. Prime Inst money fund yields were up one bp to 4.28% in the latest week. Government Inst MFs were down 2 bps to 4.14%. Treasury Inst MFs were down one bp to 4.09%. Treasury Retail MFs currently yield 3.86%, Government Retail MFs yield 3.84%, and Prime Retail MFs yield 4.04%, Tax-exempt MF 7-day yields were up 77 bps to 2.70%. Assets of money market funds fell by $24.6 billion last week to $7.326 trillion, according to Crane Data's Money Fund Intelligence Daily. For the month of February, MMF assets rose by $94.2 billion, after increasing by $52.8 billion in January, $110.9 billion in December, $200.5 billion in November, $97.5 billion in October and $149.8 billion in September. Weighted average maturities were up 1 day at 36 days for the Crane MFA and 1 day longer at 37 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (3/14), 94 money funds (out of 795 total) yield under 3.0% with $91.2 billion in assets, or 1.2%; 253 funds yield between 3.00% and 3.99% ($1.371 trillion, or 18.7%), 448 funds yield between 4.0% and 4.99% ($5.864 trillion, or 80.0%) and following the recent rate cut there continue to be zero funds yielding 5.0% or more. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.41%. The latest Brokerage Sweep Intelligence, with data as of March 14, shows no changes over the past week. 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.
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