Money Market News
A court decision from the U.S. District Court of Minnesota tells us, "Defendants U.S. Bancorp and U.S. Bancorp Investments, Inc., provide a bank-deposit (or 'cash-sweep') program for investment-account customers. Under the program, uninvested cash balances in participating customers' accounts are periodically transferred (or swept) into interest-bearing deposit accounts, and customers are paid interest. Plaintiffs Adam Saul Futo and James Bartley Ellis are two investment-account customers who participated in Defendants' cash-sweep program. In this would-be class action, Mr. Futo and Mr. Ellis allege that Defendants paid them and all other participating customers unreasonably low, below-market interest rates. Plaintiffs invoke subject-matter jurisdiction under CAFA and assert several claims arising under state law." (Note: Register soon for our upcoming Bond Fund Symposium, which is March 19-20 in Boston. We hope to see you later next month!)
The Office of Financial Research (OFR) posted a blog that asks, "How Will Central Clearing Impact the Repo Market?" It states, "The U.S. repurchase agreement (repo) market serves as a core channel for liquidity in the U.S. Treasury market. As of August 2025, over $8 trillion in U.S. Treasury-collateralized repo was outstanding, much of which is renegotiated daily. Short-term repos provide market participants with low-cost funding sources that support the smooth functioning of broader financial markets. However, these sources expose financial markets to stability risks since funding can dry up quickly."
Federated Hermes reported it Q4'25 earnings Thursday night and hosted its Q4'25 earnings call on Friday morning. In the press release, President & CEO J. Christopher Donahue, says, "Federated Hermes' record assets at year-end were again driven by money market asset increases, as our liquidity products provided attractive cash management resources and opportunities for risk-adjusted returns. We also continued to see investor interest in our growing range of investment solutions beyond mutual funds, including ETFs, CITs and SMAs, which provide additional opportunities for financial professionals to meet the needs of their customers. In the fourth quarter, SMA net sales were led by our MDT All Cap Core strategy, our MDT Mid Cap Growth equity strategy and our Core Plus fixed-income strategy." (Note: Please join us for our next event, Bond Fund Symposium, which is March 19-20 in Boston, Mass.!)
The Investment Company Institute's published its latest weekly "Money Market Fund Assets" and its monthly "Trends in Mutual Fund Investing - December 2025" and "Month-End Portfolio Holdings of Taxable Money Funds" on Thursday. The former report shows money fund assets rebounding by $13.0 billion to $7.712 trillion, after decreasing by $30.8 billion the previous week. Three weeks prior assets were a record $7.804 trillion. Assets have risen in 15 of the last 19 weeks and 23 of the past 28 weeks. MMF assets are up by $839 billion, or 12.2%, over the past 52 weeks (through 1/28/26), with Institutional MMFs up $530 billion, or 12.9% and Retail MMFs up $309 billion, or 11.2%. Year-to-date in 2026, MMF assets are down by $22 billion, or -0.3%, with Institutional MMFs down $10 billion, or -0.2% and Retail MMFs down $12 billion, or -0.4%.
Fidelity announced the launch of a new stablecoin and says it will also manage the stablecoin's reserves. Their press release titled, "Fidelity Investments to Expand Digital Asset Investment Lineup with Stablecoin Launch: Fidelity Digital Dollar (FIDD)," tells us, "Fidelity Investments is set to launch its first stablecoin, Fidelity Digital Dollar (FIDD), which will be issued by Fidelity Digital Assets, National Association, and available for retail and institutional investors in the coming weeks." (Note: Please join us for our upcoming Bond Fund Symposium, which is March 19-20 in Boston, Mass! To register and for more information, visit www.cranesbfsymposium.com. Ask us about speaking or getting 2-for-1 or "comp" ticket!)
The SEC published its latest quarterly "Private Funds Statistics" report recently, which summarizes Form PF reporting and includes some data on "Liquidity Funds," or pools which are similar to but not money market funds. The publication shows overall Liquidity fund assets were higher in the latest reported quarter (Q2'25) at $389 billion (up from $374 billion in Q1'25 and up from $343 billion in Q2'24). We also again briefly review the SEC's "Amendments to Form PF Reporting Requirements for Large Liquidity Fund Advisers" which went into effect a year and a half ago, below. (Note: We're still looking for sponsors and speakers for our upcoming Bond Fund Symposium, which is March 19-20 in Boston, Mass.)
Money fund yields (7-day, annualized, simple, net) decreased by 1 bp to 3.50% on average during the week ended Friday, January 23 (as measured by our Crane 100 Money Fund Index), after decreasing 2 bps the week prior. Fund yields haven'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 as the market expects the Fed to hold rates steady this week (and perhaps this year). Yields were 3.58% on 12/31/25, 3.78% on 11/30, 3.90% on 10/31, 3.94% on 9/30, 4.11% on 8/31, 4.12% on 7/31, 4.13% on 6/30, 4.14% on 3/31/25 and 4.28% on average on 12/31/24. MMFs averaged 4.75% on 9/30/24, 5.10% on 6/28/24, 5.14% on 3/31/24 and 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 681), shows a 7-day yield of 3.40%, down 1 bp in the week through Friday.
State Street Investment Management posted a brief earlier this month titled, "An oddly quiet year end." It says, "Front-end markets ended 2025 in rare calm, with tight spreads and steady ABCP pricing. As supply constraints loom and Fed policy evolves, tactical entry points and extensions remain key. US front-end markets closed the year in an unusually orderly fashion -- which, in money-market terms, is a bit like turbulence-free airspace in December: appreciated but treated with suspicion. Year-end funding needs were completed, and activity shifted to day-to-day liquidity management, with little urgency evident as we rolled through year-end. It was exceptionally quiet. Unlike prior years, term spreads have avoided the significant seasonal widening." (Note: We're still looking for sponsors and speakers for our upcoming Bond Fund Symposium, which is March 19-20 in Boston, Mass.)
As we wrote earlier this month (and reprint here), our January MFI issue recognized the top performing money funds, ranked by total returns, for calendar year 2025, as well as the top funds for the past 5-year and 10-year periods. We present the funds below with our annual Money Fund Intelligence Awards. These are given to the No. 1‐ranked funds based on 1-year, 5-year and 10-year returns, through Dec. 31, 2025, in each of our major fund categories -- Prime Institutional, Government Institutional, Treasury Institutional, Prime Retail, Government Retail, Treasury Retail and Tax‐Exempt. (Let us know if you'd like to see our latest Money Fund Intelligence issue with the MFI Awards article or our latest MFI XLS product with the performance data and rankings behind the awards. (Note: Register soon for our upcoming Bond Fund Symposium, which is March 19-20 in Boston, Mass.)
The U.S. Securities and Exchange Commission published its latest monthly "Money Market Fund Statistics" summary Tuesday. The report shows that total money fund assets rose by $125.0 billion in December 2025 to a record high $8.180 trillion, after hitting $8.055 trillion the month prior. The SEC shows Prime MMFs increased $1.2 billion in December to $1.342 trillion, Govt & Treasury funds increased $117.3 billion to $6.680 trillion and Tax Exempt funds increased $6.6 billion to $157.9 billion. Taxable yields were lower again in December following declines in November. The SEC's Division of Investment Management summarizes monthly Form N-MFP data and includes asset totals and averages for yields, liquidity levels, WAMs, WALs, holdings, and other money market fund trends. We review their latest numbers below. (Our MFI XLS monthly shows money fund assets increasing $129.2 billion in December 2025 to a record of $8.121 trillion. In January month-to-date through 1/20, total money fund assets have decreased by $9.2 billion to $8.100 trillion, according to Crane Data's separate, and slightly smaller, MFI Daily series.)
BlackRock, the 4th largest manager of money market funds with $715.9 billion, reported its Q4 2025 Earnings last week, and discussed a number of cash and fund issues on its Q4 Earnings Call. CFO Martin Small tells us, "BlackRock Cash Management saw $74 billion of net inflows in the fourth quarter and $131 billion in 2025, driven by U.S. Government, International, Prime and Circle Reserve Funds. BlackRock's platform is anchored by growth engines tied to the long-term expansion of global capital markets and fast-growing client product channels. The opportunity ahead is inspiring to reshape portfolios for more complex markets, to deepen partnerships with clients and to deliver durable, profitable growth for our shareholders."
The Investment Company Institute published, "Retirement Assets Total $48.1 Trillion in Third Quarter 2025," which includes data tables showing that money market funds held in retirement accounts jumped to $987 billion (up from $966 billion) in the latest quarter, accounting for 13% of the total $7.321 trillion in money funds. MMFs represent just 6.8% of the total $14.5 trillion of mutual funds in retirement accounts. The release says, "Total US retirement assets were $48.1 trillion as of September 30, 2025, up 4.5 percent from June. Retirement assets accounted for 34 percent of all household financial assets in the United States at the end of September 2025. Assets in individual retirement accounts (IRAs) totaled $18.9 trillion at the end of the third quarter of 2025, an increase of 5.2 percent from the end of the second quarter of 2025." (Note: Please join us for our next conference, Bond Fund Symposium, which is March 19-20 in Boston, Mass.)
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