Retail Investors Push Money-Market Funds to Record Highs as Inflation Hits 4.2%
Updated
Updated · Bloomberg · Jun 13
Retail Investors Push Money-Market Funds to Record Highs as Inflation Hits 4.2%
3 articles · Updated · Bloomberg · Jun 13
Summary
Record money-market holdings built up by the end of May as retail investors shifted cash into liquid, lower-volatility vehicles amid a shakier market backdrop.
4.2% CPI inflation in May—the fastest pace in three years—has outstripped wage gains, while fears of bear-market signals have increased demand for stability and ready cash.
Nearly 3.5% yields at the largest money-market funds in late April made cash more competitive, even with the S&P 500 still up 8.5% this year through Friday.
Advisers still frame cash as a portfolio tool rather than a return play, using it for emergency reserves, near-retirement spending needs and planned big purchases.