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U.S. bond funds see outflows for 19th straight week -Breaking


© Reuters. FILEPHOTO: This illustration of U.S. dollar banknotes is taken February 8, 2021. REUTERS/Dado Ruvic/Illustration//File Photo

(Reuters] – U.S. bond fund outflows continued in week up to May 19. This was due to concerns that the Federal Reserve will raise interest rates more than expected to control inflation.

Refinitiv Lipper data shows that investors sold U.S. bonds funds in excess of $8.39 trillion during the 19th consecutive week.

(Graphic- Fund flows: US equities bonds and money market funds:

Jerome Powell, Chairman of the U.S. Federal Reserve said this week that they will continue to “push” for tighter U.S. money policy until inflation declines.

The investors sold U.S. Municipal Bond Funds worth $3.05Billion in the largest sale in just three weeks. They also exited Taxable funds worth $5.52B.

U.S. high yield bonds funds had $2.93 trillion worth of liquidation. It was also the highest weekly net sales in five weeks. In short, intermediate investment-grade funds, outflows were $3.74 billion.

Meanwhile, U.S. short/intermediate government & treasury funds obtained inflows for a second straight week, worth $3.4 billion.

U.S. equity fund outflows reached $3.85 Billion for the sixth week in a row, although sales were down 54% from a week earlier.

After five consecutive weeks of net sales, U.S. large capital equity funds saw inflows totalling $2.59 Billion. However, small and mid-cap funds experienced outflows respectively of $1.83 and $0.69 Billion.

U.S. Growth and Value Funds saw net sales of $1.7 Billion and $200 M, respectively.

Financials and consumer discretionary were the top two sectors that saw outflows at $1.34 and $0.61 billion respectively, while utilities and healthcare drew inflows for $0.78 and $0.69 billion.

Investors drew $20.31 trillion from U.S. money markets funds, as the selling continued for another week.