The latest edition of Overview, Strategy, and Outlook, the monthly Portfolio Manager Commentary that includes the latest updates and views from Wells Fargo Asset Management’s money market investment team, led by Jeff Weaver, is now available.
Money market overview
In our February commentary, we noted that the coronavirus could pose a threat to economic growth in the coming months. We apparently were not alone in this thought. As February turned to March, it became clear that the virus had jumped borders and became more widespread in a shorter period than seemed possible only a few weeks prior. Concerns over economic growth and corporate profits soon heightened as the prospect of a pandemic grew. Coupled with an oil shock in the first week of March as Russia and Saudi Arabia battled over production, investors accelerated a search for a safe haven and liquidity that had quietly begun in the last week of February. As a result, in the four weeks ending March 25, Lipper1 reported over $66 billion flowed out of equity funds and over $138 billion flowed out of bond funds.
It is not unusual for money market funds to be the beneficiaries of risk-off trades, and so it probably comes as no surprise that the big news in money markets this month was money markets.
For more information, or to read past commentaries, visit wfam.com, click “Select Your Role” in the top navigation and select “Institutional Cash Investor”.
1. Source: Refinitiv Lipper U.S. Fund Flows: lipperusfundflows.com