Money market funds took in nearly $30 billion for the second consecutive week, pushing total assets to a new record above $5.5 trillion.

Despite buoyant risk appetite and an inflection in US equity fund flows, money funds continue to attract cash with the highest yields in some two decades.

With rates on many (most) savings products still lagging, government products offering 5% with no duration risk and, Fitch aside, no credit risk either, remain an extremely attractive proposition.

The $28.95 billion inflow came on the heels of a similarly chunky haul the prior week. Some $5.516 trillion now resides in money funds.

This week’s influx was, of course, concentrated in government funds, which took in $22.65 billion, split pretty evenly between institutional and retail investors.

The TBAC commentary which accompanied Wednesday’s refunding announcement expressed confidence in money funds’ willingness to keep absorbing bill issuance, which Treasury is poised to ramp up. Dealers are already stuffed. Their holdings hit a record earlier this month, raising predictable concerns about their capacity to intermediate elsewhere.

As long as money market funds are buyers, there shouldn’t be a problem. $5.52 trillion is one helluva big sponge, and even after falling by ~$600 billion from the peak, there’s still $1.776 trillion parked in the Fed’s RRP garage.

Since the debt limit was suspended, Treasury has issued a net ~$800 billion of bills. RRP usage has declined by around $400 billion over the same period. So far, things are going largely according to plan vis-à-vis RRP transformation mitigating reserve drain — so far.

Meanwhile, Thursday’s update showed usage of the Fed’s Bank Term Funding Program (the backstop facility established in the wake of SVB’s failure in March), rose to $105.684 billion. That’s a new record.

I suppose you could describe the figure above as indicative of “stability,” but remember: These are backstop facilities. There’s no emergency anymore, so the fact that usage keeps rising, even if slowly, is notable, although there could be an innocuous explanation.

Overall borrowing from the Fed including the discount window was $107.582 billion, a new “since late-April” high.