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© Reuters. FILEPHOTO: This illustration shows U.S. dollars banknotes taken on February 14, 2022. REUTERS/Dado Ruvic

(Reuters) – Bond funds were sold by global investors again in week ending June 8th, after they had been purchased in week prior. This was due to strong US employment figures and soaring European inflation.

Global bond fund investors pulled out $9.46 billion last week after buying $7.2 million the week prior. It was the first weekly inflow since March 30, according to Refinitiv Lipper data.

Graphic: Fund flows: Global equities bonds and money market – https://fingfx.thomsonreuters.com/gfx/mkt/dwvkrnxjmpm/Fund%20flows-%20Global%20equities%20bonds%20and%20money%20market.jpg

The Federal Reserve is expected to increase interest rates by 50 basis point next week. This will be especially true if the U.S. Consumer Price Data on Friday shows an elevated level of inflation.

Expect Friday’s inflation data to indicate that consumer prices increased by 0.7% in May.

U.S. bond funds sold net at $7.61 billion in the US and 2.66 billion respectively. Asian bonds however had only marginal sales of approximately $90 million.

After six weeks of net purchases, investors sold global government bonds funds worth $3.18 trillion. Short- and medium-term bond funds saw outflows totaling $5.2 billion. This was the largest in just four weeks.

Graphic: Global bond fund flows in the week ended June 8- https://fingfx.thomsonreuters.com/gfx/mkt/mypmnwzjzvr/Global%20bond%20fund%20flows%20in%20the%20week%20ended%20June%208.jpg

The largest net inflow to money market funds since Oct. 27 was $56.57 billion.

For the third week straight, global equity funds have secured $1.87 Billion in money, while net buying has fallen 82% from previous weeks.

Sector funds attracted inflows totalling $498 million and 332 million respectively. But tech and consumer staples were able to outgo $785 million and $571 millions respectively.

Graphic: Fund flows: Global equity sector funds – https://fingfx.thomsonreuters.com/gfx/mkt/zjpqkgrazpx/Fund%20flows-%20Global%20equity%20sector%20funds.jpg

The data on commodity funds shows that investors pulled $492 billion from precious metal and gold funds over a second week of net selling. But, the $87 million in purchases by energy funds was small.

After eight weeks of inflow, bond funds saw a net of $108 millions. However, investors bought equity funds worth $791 million.

Graphic: Fund flows: EM equities and bonds – https://fingfx.thomsonreuters.com/gfx/mkt/xmpjoxajmvr/Fund%20flows-%20EM%20equities%20and%20bonds.jpg

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