Fears of a rate rise cause a surge in withdrawals from US equities funds
Feyisayo Ajayi
1 min read
Concerns that the Federal Reserve’s harsh approach to breaking stubbornly high inflation would pull the economy into recession prompted a rise in capital withdrawals from U.S. equities funds in the week ending August 31.
Investors sold $10.19 billion in US stock funds last week, the most weekly net selling since June 15. Fund flows include stocks, bonds, and money market funds in the United States. Weekly net selling in growth funds reached $4.52 billion, the highest level in 11 weeks, while net purchasing in value funds reached $724 million. Investors also withdrew $6.46 billion from bond funds, marking the second weekly outflow.
High yield and municipal debt funds in the United States had withdrawals of $4.57 billion and $2.04 billion, respectively, while short/intermediate government & treasury funds saw inflows of $2.08 million, the largest weekly inflow since June 15. Meanwhile, investors withdrew $563 million from money market funds after pouring a net $11.07 billion the previous week.
