Municipal money market funds started 2008 with a boost, reaching record assets under management with inflows of $10.713 billion for the week ending Jan 7.

The increase in assets puts the total in tax-free money market funds at $480.43 billion, according to the Money Fund Report. This is up from last week, which saw losses of over $6 billion to cap off 2007. The report monitors 549 funds.

Average seven-day yields over the same period were 2.69%, down 19 basis points from the week that ended Dec. 31 and down 40 basis points from three weeks ago.

The average maturity is 29 days, down one day from the week before.

This week’s data marks a reversal of fund flows, and breaks a two-week string of outflows. Prior to these ups and downs, the funds saw 10 consecutive weeks of inflows, with each week setting a new record for assets. The report attributes this week’s gains to start of the year reinvestment.

Taxable funds had inflows of $50.63 billion, putting total net assets at $2.668 trillion. The combined total is $3.149 trillion of assets under management.


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