Fixed Income  

Bond fund sales plummet in May

Sales of bond funds in Europe plummeted in May after hitting record highs in April, according to the latest data from Lipper.

Bond fund sales nearly halved from €35.7bn (£30.7bn) in April to €19.7bn in May, while asset allocation funds, which are mainly absolute return vehicles, continued to have a strong year with inflows of €7.3bn.

However, preliminary Lipper figures for June suggest that bond flows may have seen net outflows during the past month as, just looking at funds domiciled in Luxembourg and Ireland, bond funds have suffered redemptions of €23bn.

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The sectors that had seen huge inflows in recent months, emerging market debt and high yield bonds, look set to be particularly badly hit, with both suffering outflows of approximately €7.5bn.