Money market funds saw outflows for a third consecutive week, but the pace slowed.

Nearly $3 billion exited on net in the week to June 28, data released on Thursday afternoon showed. Total assets fell to $5.43 trillion from a record high of nearly $5.46 trillion on June 7.

With rates still very high compared to many savings products and the Fed likely to deliver at least one additional rate hike, it’s doubtful that assets have peaked.

Total inflows in 2023 are $696 billion even after $27 billion in redemptions since mid-June.

Once again, outflows were entirely concentrated on the institutional side. A $5.8 billion inflow from retail was more than offset by $8.7 billion in redemptions from institutional, mostly from prime funds, which saw their first net outflow since April 19.

Although it’s notable that the post-SVB tsunami has receded, the outflows are a drop in the bucket so far and last week’s $18 billion exodus was difficult to interpret due to likely tax-related flows.

“Given the corporate tax payment date in June, some of these outflows could be related to liquidity management,” JPMorgan’s Nikolaos Panigirtzoglou remarked on Thursday.

As the figure below shows, the disparity between bank rates and money fund yields is still quite pronounced, to put it mildly.

“We see a resumption in outflows from banks deposits toward money market funds,” Panigirtzoglou went on, adding that the bank’s US rates team forecasts between $300 billion and $400 billion in additional money fund AUM growth. That’s a risk to bank deposits.

Speaking of banks, usage of the Fed’s newly-created Bank Term Funding Program hit another record in the week to Wednesday, at more than $103 billion.

Discount window usage was essentially unchanged, which means total borrowing from the backstops rose for an eighth consecutive week.

All in all, a mostly uneventful update on money funds and Fed borrowing that offered little to shift any existing narratives.