Rate hike fears increased during the week as reports on consumer prices and retail sales pointed to stubborn inflation and a stronger economy despite higher borrowing costs. The two-year U.S. Treasury yield , which typically moves in step with interest rate expectations, hit a three-month high of 4.718 on Friday. U.S. and Asian equity funds witnessed outflows of $3.5 billion and $310 million, respectively, but investors purchased European funds worth $1.5 billion. Tech, healthcare, and consumer discretionary sectors suffered $624 million, $408 million and $319 million worth of outflows, respectively.
Meanwhile, weekly inflows into global bond funds slipped to a seven-week low of $2.62 billion. Investors purchased global government and short- and medium-term bond funds worth $3.2 billion and $2.5 billion, respectively. But they offloaded $3.1 billion of high-yield bond funds, marking the biggest weekly selling since Dec. 21. Meanwhile, global money market funds saw $13.3 billion worth of net selling, the biggest outflow in eight weeks.
Demand for commodity funds remained weak during the week as energy funds received just $34 million, the smallest amount in three weeks. Precious metal funds also got just $2 million.
Data for 23,637 emerging market (EM) funds showed that equity funds drew $1.92 billion in a sixth week of net buying, while bond funds faced outflows worth $1.44 billion after seven weekly purchases. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Fund flows: Global equities, bonds and money market Fund flows: Global equity sector funds Global bond fund flows in the week ended Feb 15 Fund flows: EM equities and bonds ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru;Editing by Sharon Singleton)
