After a seven weeks in the desert, tax-exempt money market funds finally saw a modest trickle of inflows in the week ending Feb. 22. The gain of $187.7 million, raising total assets to $381.75 billion, marked only the second time this year that the funds were on the positive side of the ledger, according to the Money Fund Report, a service of iMoneyNet.com.
The time last the funds grew was the week ending Jan. 4, when they rang in the New Year with $2.60 billion of inflows for a total of $402.24 billion. Otherwise, outflows have dominated so far in 2010.
Last week, tax-exempt funds lost $3.88 billion and settled at $381.56 billion. The year’s biggest outflows came in the week ending Jan. 18, when investors yanked $7.67 billion.
Meanwhile, the average seven-day simple yield for the 497 tax-exempt funds in the report this week increased to 0.03% from its record low of 0.02%, where it had sat for the past six weeks. The average maturity decreased to 28 days from 30.
In the taxable market, assets in the 1,165 funds in the report grew by $4.25 billion and closed at $2.746 trillion for the week ending Feb. 23, while the yield remained at a record-low 0.02% for the third week in a row.
Last week, in contrast, taxable funds lost a whopping $35.78 billion, finishing with $2.742 trillion amid record-low yields and typical mid-month outflows by institutional funds with varying cash-flow needs.
Overall, the combined assets of the 1,662 funds reporting this week rose by $4.44 billion and settled at $3.128 trillion after plunging $39.66 billion to $3.124 trillion the week before.