Largest inflows to gold since June '09 - BAML

Added 26th February 2016

A "gold rush" of $5.8bn, the largest three week inflow to gold since 2009, has coincided with the Federal Reserve "talking-down" the US dollar and rising investor fears of a recession and quantitative easing failure, according to Bank of America Merrill Lynch’s research team.

Largest inflows to gold since June '09 - BAML

BAML also noted big precious metals inflows generally of $2.6bn.

Meanwhile, the bank saw the largest inflows to high yield in 16 weeks and a risk-on shift in fixed income corroborated by the first outflows from treasuries in eight weeks.

Furthermore, there were signs of the bull market unwinding, with outflows from healthcare/biotech in 12 of the past 13 weeks, and Japan and Europe equity funds easing. Equities saw outflows of $2.7bn and bonds recorded "very modest" outflows of $0.2bn.

"European marketing this week corroborates the super-high cash levels revealed in Feb and scarcity of bullish views; everyone, including ourselves, is a "seller into strength" which means risk can squeeze higher short-term into policy events," said the bank.

Flows are nonetheless not close to "full-capitulation" levels; investors increasingly regard policy meetings as a selling catalyst -not a buying catalyst- so selling pressure resumes if policy disappoints, according to BAML.

Emerging market debt funds recorded the first inflows in seven weeks.

Visitor's Comments Add your comment

Add Your Comment

We won't publish your address

Editor's Pick

Don't be afraid to let go of 'cherished holdings'
Don't be afraid to let...

The heart wants what it wants, but investors shouldn't...

PA ANALYSIS: Fear an EU collapse, with or without Brexit
PA ANALYSIS: Fear an...

Fresh from a close-run poll which could have so easily...

Commodities remain hurdle for US high-yield
Commodities remain hurdle...

Carl Whitbeck, head of US high yield at Axa IM, expects...