US equity funds post biggest weekly outflow in five weeks

July 22 (Reuters) – US equity funds witnessed their biggest weekly outflow in five weeks in the week to July 20, as cautious investors gear up ahead of the Federal Reserve’s policy meeting next week.

According to Refinitiv Lipper data, US equity funds recorded USD 8.45 billion worth of net selling, which was the biggest weekly outflow since June 15.

The Fed is expected to raise policy rates by another 75 basis points at the end of the July 26-27 meeting, as it seeks to balance the risks of a stubbornly high inflation and the likelihood of a recession.

US growth funds booked outflows of USD 3.46 billion after small purchases in the week before, while investors exited value funds worth USD 1.62 billion in a fourth subsequent week of net selling.

Selling in bond funds stood at a net USD 4 billion, much higher than the outflows of USD 371 million in the previous week.

Investors disposed of US municipal bond funds of USD 897 million, marking their first weekly net selling in three weeks, while US taxable bond funds recorded outflows of USD 3.43 billion.

US short/intermediate investment-grade funds, short/intermediate government & treasury funds and high yield funds suffered outflows of USD 3,008 million, USD 1,998 million and USD 1,060 million, respectively.

Meanwhile, money market funds lured a third weekly inflow of USD 4.28 billion, although purchases reduced by about 57% from the previous week.

(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Shailesh Kuber)