Get Ready for a Wave of Trillions Rotating to Bonds: Macro View

Rate cuts by the Federal Reserve mean savers will have to work harder for the fat yields they’ve become accustomed to. Bonds are set to get frothier as trillions of dollars in money-market funds seek a new home.

• The total amount in US money-market funds has swelled to an all-time high of $6.3 trillion. Investors piled in this year chasing attractive returns brought on by elevated rates, which held near two-decade highs.
• Monetary easing erodes the appeal of money markets, adding luster to other parts of fixed income like corporate bonds. Investors will have to take more risk and duration ...