Washington, D.C., July 28, 2014 - The Institute of International Finance today released new estimates for portfolio flows to emerging markets for July 2014 that saw inflows accelerate further in July, reaching a new two year high.
According to the IIF's Portfolio Flows Tracker, emerging markets received $44 billion in portfolio inflows from global investors in July, compared to $37 billion in June and $43 billion in May. This compares to average monthly inflows of $24 billion from 2010-2013.
"Portfolio inflows to emerging markets have already reached $195 billion year-to-date, only $14 billion short of inflows in all of 2013," said Charles Collyns, the IIF's Chief Economist. "Emerging markets have rebounded strongly from last year's taper tantrum and are on track for record inflows this year, propelled by avid risk appetite and little concern about the prospect of rising global interest rates. Investors seem confident - perhaps overconfident - that Fed exit will unfold very gradually."
The July figure reflects $28 billion going into emerging market bond markets (portfolio debt) and $16 billion into emerging market stock markets (portfolio equity).
Overall, the new data released in July indicates a more even balance between equity and bond inflows in the last several months. The IIF has made upward revisions of $13 billion to estimates for portfolio equity flows and downward revisions of $11 billion to estimates for bond flows in the period from April to June.
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The Institute of International Finance is the global association of the financial industry, with close to 500 members from 70 countries. Its mission is to support the financial industry in the prudent management of risks; to develop sound industry practices; and to advocate for regulatory, financial and economic policies that are in the broad interests of its members and foster global financial stability and sustainable economic growth. Within its membership IIF counts commercial and investment banks, asset managers, insurance companies, sovereign wealth funds, hedge funds, central banks and development banks. For more information visit www.iif.com.