FT News Briefing Money market madness
Mar 27, 2023
Investors are flocking to U.S. money market funds, injecting over $286 billion as concerns about banks loom large. Meanwhile, the London Metal Exchange’s shocking discovery of stones instead of nickel raises serious questions about market integrity. As midsize banks struggle with deposit outflows, crypto companies are setting their sights on Hong Kong, hoping to tap into demand from Mainland China. The volatility in the nickel market adds another layer of complexity to an already tumultuous financial landscape.
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Money Market Fund Inflows
- Investors are moving money into money market funds due to concerns about banks and the higher interest rates offered by these funds.
- This shift is primarily from institutional investors, but retail investors are also participating.
Winners of Money Market Shift
- JPMorgan Chase, Goldman Sachs, and Fidelity are the biggest beneficiaries of money market fund inflows.
- These institutions are seen as safe and reliable, attracting investors seeking stability.
Nickel Market Scandals
- Two major scandals hit nickel trading: Trafigura's $577 million fraud involving substituted metals and the LME's discovery of stones instead of nickel.
- These events raise concerns about fraud within the metals industry.