Global Navigator: Assets build in Money Market Funds

While pent-up consumer demand and catch-up business investment have been key assumptions behind the US reflation story, one reservoir of fuel for this narrative continues to fill up. During the week ending May 26, flows into EPFR-tracked US Money Market Funds hit a 51-week high, lifting year-to-date inflows to these liquidity vehicles over the $300 billion mark.

Investors remain torn between the eye-popping rebound in US economic growth, bolstered by epic levels of fiscal stimulus and expectations that the combination of current vaccinations and past infections will add up to ‘herd immunity’ against Covid-19 by 3Q21, and fears this rebound will lift inflation – and inflationary expectations – to disruptive heights. US Equity Funds recorded their 15th inflow in the past 16 weeks while Bank Loan and Inflation Protected Bond Funds absorbed fresh money for the 21st and 27th consecutive week respectively and flows into Gold Funds hit a 35-week high.

Graph depicting the 'Top 15 fund groups by net inflows in Q1 2021, and the top 15 fund groups by net inflows, quarter-to-date'.Graph depicting the 'Cumulative weekly flows and performance for Vietnam equity funds, from 2019 to date'.

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Europe equity funds latest to catch a lift

Europe equity funds latest to catch a lift

Flows into EPFR-tracked Emerging Markets Equity Funds during the third week of January climbed to their highest level since mid-1Q21 as investors positioned themselves for China’s much anticipated economic rebound and, the anti-inflation rhetoric of the Federal Reserve and European Central Bank (ECB) notwithstanding, an early end to the current interest rate cycles in the US and Europe. Investors also steered $2.5 billion – a 101-week high – into Emerging Markets Bond Funds.

Global Navigator: Emerging markets funds | Mid-January

Global Navigator: Emerging markets funds | Mid-January

Flows into EPFR-tracked Emerging Markets Equity Funds during the third week of January climbed to their highest level since mid-1Q21 as investors positioned themselves for China’s much anticipated economic rebound and, the anti-inflation rhetoric of the Federal Reserve and European Central Bank (ECB) notwithstanding, an early end to the current interest rate cycles in the US and Europe. Investors also steered $2.5 billion – a 101-week high – into Emerging Markets Bond Funds.

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