Global bond funds post massive outflows in week to May 4

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A trader works on the floor of the New York Stock Exchange (NYSE) in Manhattan, New York, U.S., May 5, 2022. REUTERS/Andrew Kelly

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May 6 (Reuters) – Global bond funds faced large outflows in the week to May 4 as soaring inflationary pressure stoked caution ahead of the Federal Reserve’s policy decision this week.

According to Refinitiv Lipper, investors exited $11.99 billion worth of global bond funds in their fifth straight weekly net selloff.

Fund flows: global equities, bonds and money market

Stoking inflation fears, data last week showed strong US consumer spending in March and rising labor costs in the first quarter, raising fears the Fed could tighten its policy. policy more aggressively than expected. Read more

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After an expected 50 basis point hike in key rates on Wednesday, Fed Chairman Jerome Powell ruled out a 75 basis point rate hike at an upcoming meeting, although he made it clear that the rate hikes the Fed already had in mind were “not going to be nice.” Read more

US and European bond funds suffered outflows of $5.58 billion and $6.24 billion respectively, while Asian funds saw marginal sales with a net worth of $0.03 billion.

Weekly net sales of global short-to-mid-term bond funds topped a four-month high of $6.9 billion, but government bond funds gained $6.18 billion in their most large weekly influx since at least June 2020.

Flows of Global Bond Funds During the Week Ended May 4

Meanwhile, weekly outflows from global equity funds fell to a four-week low of $1.79 billion.

By sector, finance and technology saw net sales of $634 million and $483 million respectively, however, utilities and consumer staples received inflows of $497 million and $457 million. dollars respectively.

Fund Flows – Global Equity Sector Funds

Money market funds saw outflows of $10.79 billion after attracting purchases of $51.72 billion the previous week.

Data from commodities funds showed that precious metals funds faced outflows worth $402 million and energy funds saw net sales of $97 million over the past year. a seventh consecutive week of releases.

An analysis of 24,183 emerging markets funds showed net sales of equity and bond funds eased to a three-week low of $565 million and $328 million respectively.

Fund flows: emerging market stocks and bonds
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Reporting by Gaurav Dogra in Bengaluru; Editing by Louise Heavens

Our standards: The Thomson Reuters Trust Principles.

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