The $3.4 Trillion Haven Where Investors ‘Hide Out for a While’
- Money-market funds rake in $18 billion in past week, ICI says
- Inverted term structure of volatility in swaptions shows panic
Photographer: Brendon Thorne/Bloomberg
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As fears of a global economic slowdown deepen and stock prices swing wildly, many U.S. investors are running for cover in money-market funds.
Extended trade tensions between the U.S. and China are exacerbating concerns of a recession that will force the Federal Reserve and other central banks to cut rates and turn to further stimulus. That has triggered a rally in Treasuries which pushed yields on even 30-year government bonds to near or below those of short-term assets held by money market funds, which are still yielding close to 2.2%.