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Franklin US Dollar Short-Term Money Market Fund - News
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Fund Name Changed
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Friday, 24 May 2019
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Official Announcement
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The Franklin US Dollar Liquid Reserve Fund will change it's name to Franklin US Dollar Short-Term Money Market Fund, effective from 24 May 2019
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Fund Name Changed
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Monday, 19 July 2010
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Official Announcement
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The Templeton US Dollar Liquid Reserve Fund will change it's name to Franklin US Dollar Liquid Reserve Fund, effective from 19 July 2010
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Templeton USDollar Liquid Reserve comment - Jul 06
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Monday, 28 August 2006
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Fund Manager Comment
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In July, Templeton U.S. Dollar Liquid Reserve Fund returned a net +0.34% (in US dollars), compared to +0.36% for its benchmark, the LIBID USD 1-Month Rate Index.
Inflation concerns continued to impact the market, which priced in a lower probability of interest rate tightening in August. (Incidentally, the market did guess correctly as the US Federal Reserve decided to maintain the Federal Funds rate at its current level of 5.25% in August.) Consumer spending remained strong, while nonresidential construction and manufacturing posted positive numbers. A weak advanced gross domestic product report for the second quarter served to quell much of the concern of further Fed tightening.
The GDP number, which came in at 2.5% (annualized), a half point under market consensus, was perhaps the most significant event during July as it afforded Federal Reserve Chairman Ben Bernanke the opportunity to pause raising rates in August.
The overall investment climate remains focused on the actions of the US Federal Reserve, while geopolitical events unfolding around the world are also grabbing attention. The Fed paused against a backdrop of slowing economic growth. In leaving the overnight rate unchanged, recent statements from the Fed appear to underline its belief that previous rate hikes are still working their way through the system. Despite the pause, the Fed also made it clear that inflationary risks remain and that it would take appropriate measures to address those risks it needed. We will monitor these economic events and adjust our strategy accordingly.
Outlook
Our positioning is not necessarily dictated by any particular factor, as our primary objective is to provide the best possible return while taking on the least amount of risk (given prevailing market conditions). Currently, we are managing the fund with a shorter maturity than its benchmark, positioning it defensively against unanticipated increases in short-term interest rates. In the process, we are seeking to take advantage of value opportunities at the short end of the yield curve. To that end, we also continue to purchase only those securities deemed to be of the highest quality.
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Templeton US Dollar Liquid Reserve comment -Mar 05
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Friday, 29 April 2005
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Fund Manager Comment
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For the quarter in review the FTIF Templeton US Dollar Liquid Reserve Fund generated a return of 0.42%. Over the period, short-term interest rates rose as the U.S. Treasury curve shifted upwards. The yield on current 3- month T-Bill rose by 55 basis points from 2.21% to 2.77% and the 6-month yield increased by 54 basis points from 2.58% to 3.12%.
In the U.S., the Federal Reserve Board (the Fed) continued to raise interest rates gradually, or 25 basis points to 2.75%. However, the accompanying FOMC statement contained changes in rhetoric regarding inflationary pressures, specifically from perceived increased pricing power, prompting concern among investors that the Fed may be building an argument for an acceleration in interest rate hikes. Inflation data released during the month continued to show gradual rise in underlying inflation, with core CPI rising to 2.4% year-on-year. Despite 175 basis points in Fed tightening during the current rate cycle, monetary policy remains accommodative and real yields are still slightly negative. While short-term interest rates have been rising in step with Fed rate changes, 10- year rates had been fairly resilient to the tightening interest rate environment. During the quarter, 10-year yields rose 26 basis points to 4.22%, compared to only 10 basis point increase in the fourth quarter of last year.
Looking forward, we anticipate the Fed to continue to gradually remove the policy accommodation as growth stabilizes around trend. As of quarter-end, the Fund's actual days to maturity were 36 days, compared to 10 days at the end of the prior quarter. The Fund consists of high quality money market securities with maturities ranging from overnight to one-year; approximately 57.13% is top-tier corporate debt, 24.40% in cash securities and 18.47% developed sovereign government/agency debt.
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Templeton US Dollar Liquid Reserve comment -Sep 04
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Wednesday, 23 March 2005
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Fund Manager Comment
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For the quarter in review the FTIF Templeton US Dollar Liquid Reserve Fund generated a return of 0.22%. Over the period, short-term interest rates rose as the U.S. Treasury curve flattened. The yield on current 3-month T-Bill rose by 44 basis points from 1.26% to 1.70% and the 6-month yield increased by 65 basis points from 1.64% to 1.99%.
During the period, the Federal Reserve Board raised the Fed Funds rate 50 basis points to 1.75% as the Fed continued to reduce policy accommodation at a measured rate. While economic growth emerged from a soft patch in early summer, growth expectations for the second half of the year were revised downwards. Oil prices ended the period close to $50 per barrel, raising concern once again that oil would create a drag on growth and add pressure to inflation. However, inflation measures excluding food and energy leveled off during the period, contributing to the flattening in the U.S. Treasury curve. In addition to lower growth expectations, further deterioration in the US trade and current account deficits weighed on the U.S. dollar. The U.S. current account deficit reached another record level of 5.7% of GDP following a widening of the trade deficit as US imports grew faster than US exports.
Looking forward, we anticipate the Fed to continue to gradually remove the policy accommodation given a moderate pace of economic growth and relatively low growth in underlying inflation measures. As of quarter-end, the Fund's actual days to maturity were 72 days, up from the previous quarter's average of 46 days. The Fund consists of high quality money market securities with maturities ranging from overnight to one-year; approximately 34.06% is top-tier corporate debt, 31.30% in cash securities and 34.64% developed sovereign government/agency debt.
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Templeton US Dollar Liquid Reserve comment -Jun 04
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Friday, 13 August 2004
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Fund Manager Comment
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For the quarter in review the FTIF Templeton US Dollar Liquid Reserve Fund generated a return of -0.04%. Over the period, short-term interest rates rose as the U.S. Treasury curve shifted upwards. The yield on current 3-month T-Bill rose by 32 basis points from 0.94% to 1.26% and the 6-month yield increased by 65 basis points from 0.99% to 1.64%.
During the quarter, U.S. economic growth maintained a relatively strong pace as retail sales growth remained high, industrial production gained momentum and corporate profit expansion continued. Inflationary measures, however, began to accelerate from their historically low levels. Sustained high commodity and oil prices as well as from rising employment and incomes contributed to building inflationary pressures. While the Federal Reserve Board (the Fed) raised interest rates by 25 basis points to 1.25%, short-term real rates remained negative and the monetary stance accommodative. The current account deficit reached a record level, $145 billion or roughly 4.7% of GDP, during first quarter 2004, and the trade balance continued to deteriorate to record levels in the second quarter. Strong consumer spending and production demand kept imports ahead of exports.
Looking forward, we anticipate the Fed to gradually remove the excess stimulus from the economy as risks of deflation decline amid higher growth. As of quarter-end, the Fund's actual days to maturity were 46 days, up from the previous quarter's average of 25 days. The Fund consists of high quality money market securities with maturities ranging from overnight to one-year; approximately 32.65% is top-tier corporate debt, 28.30% in cash securities and 39.05% developed sovereign government/agency debt.
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