6 Apr 2015
Further fall in US Treasury yields to boost foreign inflows in Asia Pacific region – ANZ
FXStreet (Barcelona) - FX Strategists at ANZ, share the Asia Pacific fund flow data for the week ending 1 April 2015, and further view that falling US Treasury Yields as a result of soft NFP might trigger further foreign inflows in the region.
Key Quotes
“Fund flows in the region reversed to register an inflow of USD227mn from an outflow of USD2,119mn the previous week. Though there were still outflows from equities totalling USD50mn, this was offset by the USD277mn inflow into bonds.”
“As there were few key data releases in the region that week, we think external drivers likely drove flows in the region. During the week, US 10Y Treasury yields fell to 1.86% from 1.93%, likely fuelling inflows into the region. Post the cut-off date, the further fall in US Treasury yields due to the poor non-farm payrolls data is likely to encourage greater foreign inflows into the region.”
“In the equities space, China continued to register an outflow of USD1,048mn from USD2,374mn the week before. This is the 7th consecutive week of outflows in equities. Notably, outflows in China have persisted despite a rebound in the China’s official manufacturing PMI in March at 50.1 from 49.9 previously.”
“For the EM region as a whole (including Asia, Latam and EEMEA), while bond inflows increased, outflows in local currency funds continued to stay heavy for the 5th consecutive week.”
Key Quotes
“Fund flows in the region reversed to register an inflow of USD227mn from an outflow of USD2,119mn the previous week. Though there were still outflows from equities totalling USD50mn, this was offset by the USD277mn inflow into bonds.”
“As there were few key data releases in the region that week, we think external drivers likely drove flows in the region. During the week, US 10Y Treasury yields fell to 1.86% from 1.93%, likely fuelling inflows into the region. Post the cut-off date, the further fall in US Treasury yields due to the poor non-farm payrolls data is likely to encourage greater foreign inflows into the region.”
“In the equities space, China continued to register an outflow of USD1,048mn from USD2,374mn the week before. This is the 7th consecutive week of outflows in equities. Notably, outflows in China have persisted despite a rebound in the China’s official manufacturing PMI in March at 50.1 from 49.9 previously.”
“For the EM region as a whole (including Asia, Latam and EEMEA), while bond inflows increased, outflows in local currency funds continued to stay heavy for the 5th consecutive week.”