Tags: Emerging | Markets | Risk | Appetite

Flows to Emerging Markets Slow as Risk Appetite Appears to Weaken

Wednesday, 27 August 2014 02:20 PM

Portfolio flows to emerging markets slowed sharply in August after months of robust investment, in what may be an early sign of a weaker appetite for risk, according to the Institute of International Finance.

Emerging markets received an estimated $9 billion in August, down from an average of $38 billion in May, June and July, data from the IIF, a Washington-based industry group representing financial companies worldwide, showed Wednesday.

“The usual seasonal lull surely contributed to the weakness,” IIF chief economist Charles Collyns said in a statement. “The sharp slowdown in portfolio flows in August could also mark the beginning of a period of greater caution among global investors.”

Emerging Europe and Africa led the slowdown, the IIF data showed. Both equity and bond issuance slowed in August, the group said in a statement, with bond sales dropping to $22 billion, half the level in the same month last year.

The Federal Reserve’s eventual exit from easy monetary policy could pose a risk to flows going forward, IIF economist Robin Koepke said in an interview, though “overall, we have a relatively favorable outlook for capital flows.”

The institute, which has almost 500 members, including investment banks and other financial industry companies from around the world, is releasing a new regional estimate drawing on bond issuance, country-level portfolio flows and other data. Wednesday’s release is the first in the series.

© Copyright 2021 Bloomberg News. All rights reserved.


Markets
Portfolio flows to emerging markets slowed sharply in August after months of robust investment, in what may be an early sign of a weaker appetite for risk, according to the Institute of International Finance.
Emerging, Markets, Risk, Appetite
229
2014-20-27
Wednesday, 27 August 2014 02:20 PM
Newsmax Media, Inc.
 
Newsmax TV Live
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved