US money-market funds: Record $8 trillion in US money-market funds: Why investors keep pouring in amid Fed rate cuts

US money market funds We now exceed $8 trillion in assets under management, a record milestone for an industry that is growing in popularity among investors seeking strong returns. Assets rose by about $105 billion in the week through Monday, reaching a new high, according to money market and mutual fund research firm Crane Data, Bloomberg reported.

Investors Are Flocked into Money Market Funds for High Returns Despite Fed Rate Cuts

Investors have continued to pour money into these funds even amid the Federal Reserve’s recent interest rate cuts, attracted by yields that remain competitive with other options, especially bank deposits. The seven-day return of the Crane 100 Money Fund Index, which tracks the 100 largest funds, was 3.80% as of December 1.
The Fed reduced its benchmark interest rate by a quarter point in September and October, bringing the policy range to 3.75%-4%. Despite this, money market funds continued to see inflows as yields remained attractive.

ALSO READ: Cryptocurrency given green light — BofA offers 1-4% allocation for wealthy investors

Why Do Money Market Funds Continue to Attract Investors?

“Money market funds continue to attract inflows as yields remain extremely attractive amid the Fed’s gradual rate cuts,” Gennadiy Goldberg, head of U.S. interest rate strategy at TD Securities, told Bloomberg. “We expect inflows to gradually decline as rates gradually decline, but historically yields above 2% should continue to attract inflows into money funds,” Goldberg added, as quoted in the report.

December Fed Interest Rate Cut Expectations

The possibility of a rate cut at the Fed’s December meeting has increased recently following comments from New York Fed President John Williams, who said he supported a rate cut despite other policymakers remaining cautious.

ALSO READ: BTC USD price surges above $91,000 today – This is what caused Bitcoin’s biggest daily rise since May

Why Do Institutions and Corporate Treasurers Prefer Money Market Funds?

Money market funds are often attractive because they pass lower rates to customers more slowly than banks. Additionally, institutions and corporate treasurers often use these funds for cash management, preferring to achieve higher returns without managing the cash themselves.

Over $848 Billion Invested in Money Market Funds in 2025

More than $848 billion has flowed into money market funds this year alone, according to Crane Data. By comparison, data from the Investment Company Institute, which excludes firms’ internal funds, put total assets at $7.57 trillion for the week ending Nov. 25.

FAQ

What will be the total size of US money market funds in 2025?
U.S. money market funds have more than $8 trillion in assets under management.

How much did money market fund assets increase last week?
Assets increased by nearly $105 billion from the week to Monday.