The combined monthly figure, while positive, is the lowest of 2023, showing cooling enthusiasm for emerging market investments as central bank rate hikes worldwide aimed at tackling inflation increased funding costs for debt.
Flows into Chinese stocks more than doubled from February to $7.2 billion, bringing total investment into Chinese equities this year to $30 billion, with the removal of COVID-19 restrictions still boosting markets.
Money going into Chinese debt also rose, to $3 billion, from $800 million in February.
But emerging markets outside China saw outflows of $500 million from equities and $400 million from bonds.
"Markets have begun to take a more cautious approach to developing-market assets as an early-year rally fades and a soft landing for the global economy appears," IIF economist Jonathan Fortun said in a statement.
"We see a crowding out effect from EM debt, with juicy
yields available in more mature markets, the incentive is lower
for investors to take on extra risk," he added.
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IIF March portfolio flows ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Reporting by Libby George, editing by Karin Strohecker and
Susan Fenton)
