Investors have poured $213.2 billion into the new, high-interest money market deposit accounts at banks and thrift institutions since the new accounts became available in mid-December.
The growth rate is slowing, however, as interest rates on the accounts have moved lower. The latest total, for the week ending Jan. 29, is up $22.4 billion from the previous week, according to preliminary figures released by the Federal Reserve Board. The accounts, which require a minimum deposit of at least $2,500 and are federally insured, were created by Congress to make banks and thrifts competitive with money market accounts.
The new, high-interest Super NOW accounts, first offered on Jan. 5, now have $17 billion in deposits.
Assets of money market mutual funds have dropped from a peak of $232 billion on Dec. 1 to $199.3 billion last week, with most of it moving to the insured money market deposit accounts and some to stocks.
Certificates of deposit of $100,000 or more and other large commercial bank deposits have declined $32.6 billion from the Dec. 1 total of $272.7 billion, while small CDs, All Savers and other small deposits are down $38 billion from $407.3 billion on Dec. 1.