Interest rates of money funds continue to fall, with Yu'e Bao and small change without exception.

Affected by the epidemic, the global liquidity investment has further increased this year, the loosening of funds has led to a continued decline in market interest rates, and the yield of money funds has inevitably declined. In the context of loose liquidity, Yu'e Bao's earnings are also at a new low every day. On June 1, its seven-day annualized yield was as low as 1.513%, 0.2 percentage points lower than the bank's benchmark one-year RMB deposit rate (1.75%), and even fell to 1.48% today.

Today, once fell into the hot search, the public indignant: "can not beat inflation, pork, or even green onions, ginger and garlic."

Not only is the yield on Yu'e Bao lower than the interest rate on bank time deposits, but also some similar "babies" have not been spared. As of the close of trading on June 2, the average annual return of 667 traditional monetary funds was about 1.53%, down 0.89 percentage points from the same period last year, according to Wind. Even the fund with the highest return from Wechat change is only about 1.78 per cent.

Why does the yield of Yu'e Bao keep falling?

Some analysts said that the continued decline in Yu'e Bao yields may have something to do with the decline in bank income from large certificates of deposit. The asset allocation of Tianhong Yu'e Bao Fund shows that bank deposits account for 51.84%.

Since 2020, affected by the epidemic, there has been an overall downward trend in the interest rate of large certificates of deposit of banks. Among the state-owned banks, taking Bank of China Ltd. as an example, the interest rates on certificates of deposit for all periods since 200000 have continued to fall. Interest rates for two-year products, for example, fell from 3.045% in April to 2.94% in May.

The situation is the same for share-holding banks. China Merchants Bank's interest rate for a five-year certificate of deposit with a threshold of 300000 fell from 3.78% in April to 3.53% in May.

There are some differences in the interest rates of large certificates of deposit recently issued by major banks. Take the interest rate of the new one-year personal certificate of deposit issued in May as an example, BoCom 2.28%, Agricultural Bank Of China 2.25%, China Construction Bank 2.175%, China Zheshang Bank 2.18%. Different banks have different deposit capacity, which may lead to differences in deposit interest rates.

Should money funds continue to be held?

In the face of the dual pressure of the COVID-19 epidemic and the high domestic unemployment rate this year, the Federal Reserve took the lead in opening the "flooding" model, and even offered a super trick of "zero interest rate" or even "negative interest rate."

Since March, as many as 17 countries or regions have opened a window to cut interest rates, Japan has released 12 trillion of water, Europe has released 6.3 trillion of credit, and major countries in the world have launched a crazy "interest rate cut" + "water release" mode.

Although China has maintained a considerable policy focus, under the stimulation of several rounds of reserve reduction, LPR interest rate reduction, reverse repo rate reduction, bank excess reserve interest rate and other policy combination, the lower interest rate is also the trend of the times. The current trend for money funds will also gradually decline as the interest rate center moves down.

Huatai analysis, the money market interest rate center further reduced. After the core intention is to increase the opportunity cost of bank lending and promote the decline of money market interest rates and short-end interest rates, interest rates such as interbank-base-financial management-large certificates of deposit-structured deposits are expected to be transmitted in turn. Bank of China Securities also suggested that June is an important marketing time for money funds. From historical experience, money funds tend to release yields and need to pay attention to fluctuations during the period.

The general trend of global allocation-- the timing of overseas fund allocation

Last week, the renminbi hit its lowest level against the dollar since September 2019. In the past two years, the trend of RMB depreciation is more obvious, and the RMB exchange rate against the US dollar has fallen by more than 10% since March 2018.

Relevant experts said that on the one hand, the pace of domestic economic development has slowed, uncertainties in the international environment have increased, and the devaluation of the RMB is conducive to alleviating export pressure; on the other hand, due to the impact of the epidemic at the beginning of the year, the market risk aversion has been high, and the US dollar index has remained high, which is also the main source of pressure on RMB exchange rate depreciation.

Speaking of which, how can you help your assets fight against depreciation? Investing in overseas funds is the best choice for long-term balanced allocation!

Because overseas funds have the characteristics of global investment, the allocation of assets denominated in different currencies can hedge the risks caused by excessive fluctuations in the exchange rate of a single currency, and geographical diversification can also hedge the systemic risks brought about by the development of a single economy. so that investors can withdraw from underperforming markets and switch to markets that can create greater profits at any time.

In the face of the risk that the RMB exchange rate may continue to depreciate, it is now an opportunity to invest in overseas funds.

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In the unpredictable, ill-fated moment, give the funds to professional fund managers, professional things to professional people to do, experts to help you financial management so that you can worry and rest assured. Select Futu debt Jibao to achieve portfolio investment not only to maintain liquidity security but also to maximize returns.