ETF Snapshot: Government bonds record first outflows since June

Small outflows of €78m

In the week ending 6 October, government bond ETFs was the only fixed income asset class in the red, according to data from TrackInsight, as central banks globally signal a reversal in loose monetary policy.

Government bonds saw outflows of €78m, the asset class's first since 16 June, as investors prepared for a tightening of monetary policy from the Bank of England in November, typically seen as negative for bonds, and the reduction of the Federal Reserve's $4.5trn balance sheet. However, investment grade bonds continued to record strong inflows of €963m, while there was also an appetite for riskier assets such as high yield and emerging bonds, which saw inflows of €824m and €30m respectively. In the equities space, US large-cap ETFs was the only asset class to record outflows (-€576m), ...