Will cash be king as the Fed hikes rates?

Cash yields have risen along with rates, which may help investors reduce duration risk

By Rob Corner, Senior Client Portfolio Manager

US money market fund balances recently reached their highest level in seven years and, according to Crane Data, average money market fund yields crossed the 1% threshold for the first time since November 2008. Invesco Global Liquidity believes that more investors may consider cash and conservative fixed income solutions as part of their active asset allocation in the near term for multiple reasons.

Cash yields rise due to Fed rate-hiking cycle

Yields on cash and conservative low duration vehicles have become more attractive since the US Federal Reserve (Fed) began removing monetary policy accommodation and moved away from a near-zero federal funds rate. Since December 2015, this policy shift has driven...

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