The amount of money parked at money-market funds rose to an all-time high for the second straight week as investors sought higher rates, extending the trend of moving away from lower paying US bank deposits.

With the Federal Reserve raising their main policy rate to its highest level in 16 years last week in the most aggressive hiking cycle in decades, short-term rates above 5% continue to lure investors to money-market assets. The latest high-water mark comes amid concern about the steadiness of some smaller lenders, and for now investors are looking past the debt-ceiling impasse in Washington that has plagued rates for securities maturing in June and late July.

About $18.33 billion poured into US money-market funds in the week to May 10, lifting total assets to an unprecedented $5.33 trillion, according to data from the Investment Company Institute. The week before, about $47.2 billion in net new money flowed into the funds.

In a breakdown for the week to May 10, government funds, which invest primarily in securities like Treasury bills, repurchase agreements and agency debt saw assets rise to $4.43 trillion, a $9.35 billion increase. Prime funds, which tend to invest in higher-risk assets such as commercial paper, saw assets rise to $785 billion, a $6.9 billion increase. 

--With assistance from Alexandra Harris.

This article was provided by Bloomberg News.