Has the floor been raised for the money markets?

Money markets appear to be shifting from an exceptional, rate-hike-driven phase into a more durable “new normal” in which cash yields remain competitive even as the Fed eases. Despite 150 basis points of cuts since 2023 and typical seasonal redemption pressures, assets in money market funds have continued to climb to record highs, suggesting investors value both yield and stability.

Laddered portfolio structures have helped keep fund yields above direct Treasuries, reinforcing the appeal of stable value products as a core liquidity tool rather than a temporary trade. At the same time, persistent uncertainty around monetary policy, the economy and geopolitics is encouraging investors to favor conservative cash strategies.

For advisors and investors, this environment argues for disciplined liquidity management that preserves flexibility for tax-related outflows while positioning cash as a strategic asset in portfolios.