EM and DM bond funds continued to see outflows

Fund flow data for the week ended 17 June showed that both developed-market (DM) and emerging-market (EM) bond funds continued to see outflows related to US Treasury (UST) volatility. Outflows from DM and EM bond funds were broad-based, with both retail and institutional investors reducing exposure. 

DM bonds funds saw heavy outflows in the past week, with funds at both ends of the credit spectrum - government bond funds and high-yield (HY) funds - witnessing outflows. HY fund outflows were mainly from US-dedicated funds, though European and global HY funds (including Asia-dedicated funds) also witnessed outflows. 

EM bond funds saw a fourth week of outflows, though outflows slowed. EM local-currency (LC) funds received small inflows, which went mainly into regional funds, global EM LC funds continued to see outflows. Worryingly, outflows from EM hard-currency (HC) bond funds picked up for the fourth straight week.