Two major money fund raters are reviewing how they assign ratings to the funds. While Fitch Ratings is preparing to hold prime money market funds to stricter standards that could lead to downgrades, Standard & Poor's review of its process will likely not lead to massive shifts. Moody's, the third major rater, did not comment on any potential changes to the paper.

Dow Jones reporter Daisey Maxey reports that Fitch may downgrade money funds from triple-A if regulators do not take action to fundamentally change they way the funds operate or are supported.

The fund-rater added that the ratings are currently supported by Fed's Commercial Paper Funding Facility and Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility. Both of those programs will run through next February.

The Treasury's guaranty program is set to expire on September 18.

Meanwhile, the paper points to both the SEC's proposed regulations on money market funds and the President's Working Group on Financial Markets which will take up the issue of potential fundamental reforms.

Peter Rizzo, senior director in S&P's fund rating group points out that many money-market funds are no longer depending on the guaranty program and that the SEC's proposed regs would further lessen any risks in the funds. 

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