EM local-, hard-currency bond fund flows narrowly mixed for latest week: EPFR Global

By Rebecca Melvin

New York, Nov. 30 – Emerging markets sovereign bond funds recorded their biggest inflow since late September, with investors favoring funds with global and emerging Asia mandates. But these flows were offset by outflows from corporate and mixed funds, fund flows and asset allocation data tracker EPFR Global said regarding the latest week.

Investors pulled $238 million from hard-currency funds, but also funneled $162 million into local-currency funds, for the week ending Nov. 28.

The week’s tally’s hardly put a dent in the tide of flows so far this year.

For the year to date, hard-currency funds have had $3.1 billion in outflows, and local-currency funds have had even bigger outflows totaling $3.96 billion.

Global investors were mostly sellers of fixed-income asset classes in the latest week, as they sought to reduce exposure to assets they see as a liquidity risk in times of market stress, EPFR said in its weekly report.

But emerging markets equity funds extended their current streak of inflows, which is their longest since an 11-week run that ended in May. The EM equity fund inflows in the fourth week of November came despite questions that swirled around the pace of future Chinese and global economic growth, EPFR said.

Some of those questions stemmed from the tightening of monetary policy in the eurozone and the United States, while markets responded favorably to U.S. Federal Reserve Chairman Jerome Powell’s comments on Wednesday in which he described U.S. short-term interest rates as close to neutral.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.