, Columnist
Starving for Yield? Check Out Money-Market Funds
One upside of the Fed’s inflation fight has been a surge in the rates paid by mutual funds that invest mostly in short-term government bonds.
Not paying 4%.
Photographer: Ron Antonelli/Bloomberg
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If you think high-yield savings accounts offer juicy rates to park some cash, wait until you see what money-market funds are paying.
Yields paid by the typically staid mutual funds, which invest mostly in short-term government bonds, spiked from 0.02% earlier this year to more than 3.6% as of early December, according to Crane Data’s 100 money-market fund index. After this week’s rate increase by the Federal Reserve, money-market fund yields are poised to soar even higher.