© . A man in a protective mask walks past an electronic board displaying Japan’s Nikkei index outside a real estate agency in Tokyo, Japan, March 10, 2022 during the coronavirus disease (COVID-19) outbreak. REUTERS/Kim Kyung-Hoon By Gaurav Dogra ( ) – Emerging Asian bonds excluding China continued to see foreign inflows for the 21st straight month in February, but analysts are turning pessimistic about the outlook amid concerns about higher US interest rates, rising inflation and increasing global fallout from the war in Ukraine. Overseas investors bought a combined net total of $6.01 billion in South Korean, Thai, Indian, Indonesian and Malaysian bonds last month, compared with a net purchase of $6.37 billion in January, data from regulatory authorities shows. agencies and bond market associations. Monthly Foreign Investment Flows: Asian Bonds https://fingfx.thomsonreuters.com/gfx/mkt/akvezxwlepr/Monthly%20foreign%20investment%20flows%20Asian%20bonds.jpg South Korean bonds received $3.29 billion in foreign purchases last month , while Thai bonds raised $1.73 billion, their fifth consecutive monthly inflow. Malaysian and Indonesian bonds also received foreign capital worth $750 million and $651 million, respectively. On the other hand, Indian bonds suffered an outflow of $421 million, after inflows of $698 million in the previous month. “As the conflict between Russia and Ukraine took place in the second half of February, bond flow figures for the full month may not fully reflect the impact on foreign demand for Asian bonds,” said Duncan Tan, a strategist at DBS Bank. “In the short term, with geopolitical risks and the Fed’s projected surge on Asian bonds, foreign bond inflows are likely to be weak.” Interest rates rose to their highest level in two and a half years, ahead of an expected decision by the Federal Reserve later Wednesday to raise US interest rates for the first time in three years. Despite uncertainties about the broader impact of the crisis in Ukraine, analysts expect the Fed to act aggressively this year to avert rising prices, with annual inflation rising at its fastest pace in 40 years in February. “Geopolitical tensions, tighter US liquidity and high energy prices will all weigh on portfolio flows to Asia,” added Khoon Goh, head of Asia research at ANZ, adding that he expects an outflow of emerging Asian stocks and bonds in the near term. Holdings of Foreign Investors in Asian Bonds https://fingfx.thomsonreuters.com/gfx/mkt/byvrjewaxve/Foreign%20investors’%20holdings%20in%20Asian%20bonds.jpg Disclaimer: Fusion Media would like to remind you that the data on this website is not necessarily real-time or accurate. All CFDs (Stocks, Indices, Futures) and Forex prices are not provided by exchanges but rather by market makers, and therefore prices may not be accurate and may differ from the actual market price meaning prices are indicative and not suitable for trading purposes . Therefore, Fusion Media does not bear any responsibility for any trading losses that you may incur as a result of using this data. Fusion Media or anyone associated with Fusion Media accepts no liability for any loss or damage resulting from reliance on any information, including data, quotes, charts and buy/sell signals on this website. Be fully informed about the risks and costs associated with trading the financial markets, it is one of the riskiest forms of investment possible.
