Global FX funds received a strong influx in the week leading up to March 15
March 17 (Reuters) – The global foreign exchange market and government bond funds received massive weekly inflows as investors focused on safer assets amid fears of spreading the crisis caused by the collapse of three US banks last week.
The turmoil in the market sent funds to risk capital outflows, although sentiment improved on Thursday after major US banks injected San Francisco-based First Republic Bank and Swiss bank Credit Suisse secured an emergency loan from the central bank.
Global FX funds raised $112.13 billion in the week ending March 15, according to Refinitiv Lipper. $8.22 billion inflows to government bond funds during this period, the highest weekly inflow since July 13, 2022.
Investors pulled $19.2 billion from global equity funds, the largest weekly net outflow since the third week of December.
US, European and Asian equity funds lost $17.22 billion, $3.31 billion and $270 million respectively.
Among the capital sector funds, healthcare, industry and metals reported net sales of $645 million, $613 million and $258 million, respectively. However, non-essential consumer goods funds received a net inflow of $507 million.
Global bond funds posted their first weekly outflow of $5.15 billion in 11 weeks, with a net outflow from high yield funds of $2.51 billion.
Among commodities, approximately $250 million flowed into precious metals funds, the highest weekly inflow in seven weeks, while energy funds saw a modest outflow of $33 million.
Data from 23,846 emerging market funds showed that investors pulled $1.23 billion from bond funds and $1.37 billion from equity funds after nine consecutive weeks of net buying.
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(Gaurav Dogra and Patturaja Murugabupati in Bangalore)