(Reuters) – Large outflows of U.S. equity funds occurred in the week ended September 29th, driven by concerns about a rising U.S. Treasury yield and persistent inflation.

Lipper reported that U.S. equity fund outflows reached $6.24 trillion, their highest level since August 25, the data show.

Fund flows into U.S. equities bonds and money market funds: https://fingfx.thomsonreuters.com/gfx/mkt/gkvlgwybzpb/Fund%20flows%20into%20U.S.%20equities%20bonds%20and%20money%20market%20funds.jpg

Last week, the U.S. Federal Reserve forecast that they will be ready to increase rates by 2022. They also predicted that the bank would begin to reduce its monthly bond purchases in November.

Inflation was expected to rise by 4.2% in 2019, more than twice its target rate of 2%. Jerome Powell, Fed Chair, indicated this week that inflationary pressure could last longer than expected due to challenges from reopening leakages.

Large cap equity funds in the United States were hardest hit, with sales jumping to $8.6 Billion (as high as four months ago). Also, investors sold $360 million in mid-cap funds and bought $2.62 trillion small caps.

Both equity growth and value funds experienced outflows of $1.85 billion and $4.01 billion, respectively.

Health care, industrials, and technology saw net sales exceeding $400 million. Financials, however, received $1.65 billion in net sales after three consecutive weeks.

Flows into U.S. equity sector funds: https://fingfx.thomsonreuters.com/gfx/mkt/movankawrpa/Flows%20into%20U.S.%20equity%20sector%20funds.jpg

Fund flows into U.S. growth and value funds: https://fingfx.thomsonreuters.com/gfx/mkt/zdvxodbqbpx/Fund%20flows%20into%20U.S.%20growth%20and%20value%20funds.jpg

U.S. money-market funds attracted large investments for the second consecutive week. They were worth $29.8 billion.

U.S. Bond funds attracted $2.9 Billion, although purchases were down 50% from the previous week.

U.S. municipal bonds funds suffered a decrease in flows as net purchases fell to $217m, an 84% drop from the previous week. U.S. domestic general taxable fixed income funds (USGIF) and U.S. intermediate/short investment-grade funds saw larger inflows of $1.76 billion, respectively.

U.S. inflation-protected money attracted inflows to the tune of $625million for the 10th week.

Flows into U.S. bond funds: https://fingfx.thomsonreuters.com/gfx/mkt/znpnebalrvl/Flows%20into%20U.S.%20bond%20funds.jpg