Money Flowing Out Of Emerging Markets In Asia Has Slowed To A Trickle

ANZ’s brilliant weekly wrap of portfolio flows in Asia has just hit the inbox and it shows a big turn around in the bearish sentiment that saw money rush out of Asia, particularly China last week.

For the week ending March 26 ANZ says EPFR funds flow data shows the outflow from emerging Asia slowed materially “to $US0.6bn from $US3.4bn”. Showing the turn in sentiment, which might help explain why the Aussie dollar keeps rallying and has now been joined by its Dollar Bloc cousins in Canada and New Zealand with strength against the US dollar, it was equity outflows which were the big mover slowing to $US0.4bn from $US3.1bn.

Still Negative but much less so

Of particular note ANZ said: “While moderation in Asian equities outflow was seen across the board for most countries, China remained the dominant driver, registering the biggest reduction in outflows (to US$138m from US$2.0bn)”.

Very interestingly South Korea and Thailand registered “an inflow for the first time in 13 weeks”.

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