Series 62

AAA

The Money Market - Other Money Market Instruments

Government Money Market Instruments

The Government and many of its agencies will go to the money market to obtain short- term funds. Some of the government money market instruments include:

  • Treasury Bills
  • Treasury and agency securities with less than one year remaining
  • Short term discount notes issued by government agencies

Municipal Money Market Instruments

State and local government will sell securities in the municipal money market to obtain short-term financing. The municipal money market instruments are:

  • Bond anticipation notes
  • Tax anticipation notes
  • Revenue anticipation note
  • Tax and revenue anticipation notes
  • Tax exempt commercial paper

Government and municipal issues with less than one year to maturity, regardless of the original maturity, may be traded in the money market.

International Money Market Instruments

Often large institutions will place US dollars in foreign accounts to earn a higher rate of interest. These dollars being held outside of the US are known as Eurodollars. A US dollar denominated account outside of the US is known as a Eurodollar deposit. These deposits typically have maturities of up to 180 days and they are traded between large European banks and institutions, much like federal fund loans in the US.

Interest Rates
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