NEW YORK – Investors pulled a modest amount of cash out of the $2.67 trillion money-mutual-fund market in the past week as some short-term securities were hit by Washington gridlock over the U.S. debt ceiling. During the week ended Wednesday, investors withdrew $19.78 billion, according to data from Investment Company Institute. Prices fell and yields spiked on short-term Treasury bills, often held in money market funds, as lawmakers discussed a deal to keep the U.S. from hitting the debt ceiling. "Outflows from money market funds were very modest in the last week, well within the range that money market funds can easily accommodate, given their high liquidity requirements," said ICI chief economist Brian Reid.
Copyright © 2013 MarketWatch, Inc.