Rising interest rates lift money market fund returns

Top money market funds are offering an annualised rate of up to 12 percent as of June 26 compared to 11.13 percent on March 31.

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Rising interest rates on Treasury bills and other short-term debt instruments have helped lift returns offered by money market funds (MMFs), which invest primarily in commercial banks, fixed deposits and government securities.

An analysis by the Business Daily shows that the annualised returns on the funds popularly known by their acronym MMFs have climbed since March, coinciding with the lift in interest rates on the short-dated Treasury bills.

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Note: The results are not exact but very close to the actual.