MMFs lengthen portfolio maturity post-Covid – BIS
Average holdings had maturity of 41 days in November
Prime money market funds (MMFs) funnelled cash into longer-dated assets than usual following March’s Covid-induced economic crisis, data from the Bank for International Settlements (BIS) shows. The shift was likely prompted by a search for yield by funds starved of it in the current low-rate environment.
The average maturity of portfolio holdings for prime MMFs – those invested in commercial paper – was 41 days at end-November, and peaked at 44 days in the second half of August, up from 31 days
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