In the week ending 13/02/2019, bond funds saw a total inflow of 8.8 billion US$ vs equity funds which saw an outflow of 6.8 billion US$.
In the second week post-FOMC Emerging markets continued to see interest as the dovish statements from the FED increased risk appetite towards these countries. EM Equities had an inflow of 1.5 billion US$ and EM bonds had an inflow of 1.1 billion US$. Looking at two-week cumulative inflows as a percentage of total AUM, Global Emerging Markets(GEM) mandated bond funds has seen a significantly higher inflow compared to previous post-FOMC flows. In the two weeks post FOMC EM bond funds saw an inflow of 5.5 billion US$ – 3.5 billion US$ in EM Hard Currency bond funds and 2 billion US$ in EM Local/Blend Currency funds.
Developed market equity funds saw an outflow of 8.3 billion US$ in total. As the risks in Europe continue to build up, topics like Brexit, EU parliamentary elections and Eurozone growth forecasts draws higher attention of investors. Europe equity funds has seen an outflow of 5.9 billion US$ which was the second largest weekly outflow since June 2018. US Equity funds saw a relatively lower outflow of 600 million US$. Developed market bond funds continued to have inflows. This asset class saw inflows of 7.6 billion US$. Expectation of a pause in the US rate hike cycle has also increased flows to the longer end of the curve.
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