(Reuters] – The global bond fund market saw large outflows over the week to Dec. 15th. Investors anticipated major central banks would alter their monetary policies during this week’s key policy meeting, as they were under pressure from rising inflation.

Refinitiv Lipper data revealed that global bond funds valued at $6.91 trillion were sold by investors, their largest weekly net sale since April 8, 2020.

Graphic: Fund flows into global equities bonds and money markets https://fingfx.thomsonreuters.com/gfx/mkt/akvezoleqpr/Fund%20flows%20into%20global%20equities%20bonds%20and%20money%20markets.jpg

Prior to Wednesday’s Federal Reserve Policy Meeting, the U.S. consumer prices index rose 6.8% for the 12 months ending November. It was the highest year-on-year increase since June 1982.

This week’s Fed policy meeting saw the Fed increase its tapering pace for its monthly bond-buying program by two and outline three interest rate increases next year. Britain raised its interest rates while the European Central Bank slowed down its bond-buying program.

U.S. bonds funds saw net sales of $7.48bn, but investors bought European and Asian bond funds worth $1.45bn and $0.19bn respectively.

Inflows to global government bond funds reached $809 million in seven weeks, after which inflation protected funds attracted $1.32 Billion net purchasing, an increase of 39% over the previous week.

Graphic: Global bond fund flows in the week ended Dec 15 https://fingfx.thomsonreuters.com/gfx/mkt/klpyknrqmpg/Global%20bond%20fund%20flows%20in%20the%20week%20ended%20Dec%2015.jpg

Global equity funds were sold by investors for $13.14 billion versus net investments of $3.43 trillion in the week before.

Technology funds received inflows in excess of the $1.91 billion that was expected from equity sector funds. This is a significant increase over last week’s outflow. While healthcare and materials funds were each able to receive over $400m, the net sale of utilities was $588 million.

Graphic: Global fund flows into equity sectors https://fingfx.thomsonreuters.com/gfx/mkt/byvrjqamrve/Global%20fund%20flows%20into%20equity%20sectors.jpg

Following eight weeks of steady inflows to global money markets funds, there were also outflows totaling $20.46 trillion.

Precious metal funds posted net sales of $402 millions, marking the second consecutive week of outflow. After two weeks of net buying, investors also sold $96 million worth of energy funds.

Analysing 24,070 emerging markets funds revealed that bond funds saw outflows in excess of $4.49 Billion, which is the highest since March 25, 2020. Investors sold $1.51 Billion equity funds.

Graphic: Fund flows into EM equities and bonds https://fingfx.thomsonreuters.com/gfx/mkt/lbvgnlxjbpq/Fund%20flows%20into%20EM%20equities%20and%20bonds.jpg