US investors helped worldwide money market funds (MMFs) reach record inflows in 2023.
The international quarterly statistical release from Efama, the association for European asset managers, showed that global MMFs pulled in close to €1.4 trillion in net inflows during the year.
In Q4, there was a 4.2% increase in net assets to €67 trillion, which amounted to an 8.7% increase in US dollar terms due to depreciation against the euro.
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US investors were responsible for around two-thirds of the inflows (circa €1 trillion). According to Thomas Tilley, senior economist at Efama, many US investors were attracted by the higher returns offered by MMFs in comparison to deposits.
In contrast, net sales of MMFs were negative in the Asia-Pacific region (EUR 17 billion), mainly due to China which accounted for €15 billion of the €17 billion of outflows.
Global long-tern funds also enjoyed a surge in demand in Q4 recording €340 billion in net inflows.
Again, US investors were the main participants in the increase, accounting for more than half (€175 billion) of the total net inflows.
