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Sharp outflows from bond funds across the regions - RBS

FXStreet (Delhi) – Research Team at RBS, notes that in the week to last Wednesday, EM FI funds suffered sharp redemptions, at -0.77% of AUM vs. -0.46% a week earlier.

Key Quotes

“Deterioration over the recent weeks was likely associated with the rise in front-end US yields following the latest FOMC meeting and the stronger-than-expected US payroll release on 6 November. Weaknesses were recorded across the regions. Local and blend currency funds saw multi-month high withdrawals, while hard currency flows were small, but positive.”

“EM Equity flows stayed in the red, with the latest weekly print at -0.18% of AUM. Redemptions from EM Asia almost solely account for the weaknesses recorded by the asset class in the latest week.”

“DM FI fund flows dipped into the negative, recording weekly withdrawals at -0.14% of AUM, after a series of healthy inflows (cumulatively +0.42%) over the previous four weeks. Regionally, DM Europe, North America and DM Asia all saw outflows.”

“Finally, DM Equity flows stayed relatively muted (+0.08% of AUM), with DM Europe accounting for most of the total injections into the asset class- the region attracted inflows at +0.24%, strongest since August.”

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