Tax-Exempt Money Markets See $1.87B Outflow

Outflows of $1.87 billion for the week ending March 30 caused tax-exempt money market funds to start the second quarter with $482.57 billion in total assets, according to the Money Fund Report, a service of iMoneyNet.com.

The average, seven-day simple yield of the 508 tax-exempt funds in the report inched up to 0.34% from 0.33% for the week ending March 23, while the average maturity declined by one day to 24 days. Last week, tax-exempt funds lost $1.32 billion and ended the week of March 23 with $484.44 billion in total assets, according to the report.

In the taxable market, meanwhile, 1,213 funds lost a whopping $46.85 billion to settle at $3.265 trillion for the week ending March 31, a big turnaround from the $7.39 billion of inflows that caused the funds to end the week of March 24 with $3.312 trillion in assets. The average, seven-day simple yield for the taxable funds dropped to yet another record low of 0.23% from last week’s 0.24%. The funds are achieving the record-low yields at the same time that the target federal funds rate for overnight lending between banks remains between zero and 0.25%.

Overall, the combined assets of the 1,721 funds in the report declined by $48.72 billion to end the week of March 31 with total assets of $3.748 trillion, versus assets of $3.796 trillion for the week ending March 24 when the funds added $6.07 billion.

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