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Fund Commentary

 
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Government Assets Portfolio

as of 8/31/17

Fund Commentary

Neither Federal Reserve (Fed) Chair Yellen nor European Central Bank (ECB) President Draghi took the opportunity to use Jackson Hole as a platform to announce or hint at any policy shift. Some had thought Draghi may signal tapering the ECB's asset purchase program. The lack of inflation seems to be puzzling many of the most powerful central banks and the Federal Reserve is no exception. The July Fed minutes reflected that many anticipate that the lower inflation is not transitory and the readings could continue to be below their 2% mandate for longer than they initially thought. It is still expected that the Fed will announce the start of their balance sheet normalization process in September. The economy continues to make strides. Second quarter Gross Domestic Product (GDP) was revised up to 3%. The labor market with the exception of wage inflation continues to strengthen. Consumer confidence is near the highest level it has been in over fifteen years. We continue to position ourselves conservatively with a neutral duration strategy. Liquidity and principal preservation remain our primary objectives.

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An investment in the Money Market Funds is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency. Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Funds.

Please carefully read the summary prospectus or prospectus and consider the investment objectives, risks, charges and expenses of Northern Institutional Funds before investing. Call 800-637-1380 to obtain a summary prospectus or prospectus, which contains this and other information about the Funds.

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