US money market assets rise for 1st time in 4 wks -iMoneyNet


By Caroline Valetkevitch

NEW YORK, Oct 23 (Reuters) - U.S. money market fund assetsrose in the latest week, the first gains since the week endedSept. 24, as investors shifted money back into assets followinga deal to extend the U.S. debt ceiling deadline, a reportreleased on Wednesday showed.

Money market assets increased by $34.64 billion to $2.640trillion in the week ended Oct. 22, according to the Money FundReport published by iMoneyNet.

"We recouped about half of what was taken out," said MikeKrasner, managing editor at iMoneynet, noting that total assetswere down about $62.70 billion in the three weeks prior to thelatest period. "It's been flowing back every day since Oct. 16."

U.S. money market fund assets recorded their largestone-week decline in nearly a year in the week ended Oct. 15,falling $44.77 billion to $2.606 trillion.

The legislation to raise the debt ceiling was signed byPresident Barack Obama just before the U.S. government wasexpected to exhaust its statutory $16.7 trillion borrowing limitThursday, pulling the world's biggest economy back from thebrink of a historic default.

Worries about a default had led large money fund operatorsto shed holdings of Treasury bill issues that mature inlate-October to mid-November, the issues that were consideredthe most vulnerable if the government were to delay its debtpayments.

The iMoneyNet report also said that in the week ended Oct.22 taxable money market fund assets increased by $35.90 billionto $2.377 trillion, while tax-free assets decreased by $1.26billion to $263.66 billion.

The iMoneyNet Money Fund Average 7-Day Simple Yield for AllTaxable money-market funds held steady at 0.01 percent. TheiMoneyNet Money Fund Average 7-Day Simple Yield for All Tax-Freeand Municipal money-market funds was also unchanged at 0.01percent.

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