U.S. money market funds witnessed huge inflows in the week ended June 4 as investor caution over a rise in U.S. tariffs on steel imports, uncertainties over U.S. President Donald Trump’s trade disputes with China and a crucial employment report on Friday, boosted demand for safer investment avenues.
According to LSEG Lipper data, U.S. investors bought a net US$66.24 billion worth of money market funds during the week, registering their largest weekly net purchase since December 4, 2024.
At the same time, riskier equity funds faced a net $7.42 billion worth of weekly outflows, sharply higher than approximately $5.39 billion worth of net disposals in the prior week.
The small-cap segment witnessed a net $2.99 billion worth of drawdowns, the highest for a week since April 30. Outflows from multi-cap, mid-cap and large-cap funds stood at $2.13 billion, $1.05 billion and $962 million, respectively.
Sectoral funds, meanwhile, experienced a minor $136 million worth of inflows with investors adding a net $1.15 billion into tech, and $309 million into consumer staples, while withdrawing nearly $1.16 billion from financials.
Weekly net inflows into U.S. bond funds, meanwhile, cooled to a four-week low of $4.8 billion during the week.
Despite the weaker demand in the broader segment, the short-to-intermediate investment-grade funds turned popular, grossing a net $3.98 billion- the highest since November 2024- worth of inflows during the week.
Inflation-protected funds and general domestic taxable fixed income funds also attracted a significant $634 million and $505 million, worth of inflows.
(Reporting by Gaurav Dogra in Bengaluru; Editing by Nick Zieminski)
