August was the fifth month in a row in which there were net inflows into global ETF and mutual funds that invest in emerging market assets. Admittedly, there was a small net outflow from funds that invest in bonds. But this was more than trumped by the largest monthly net inflow into funds that invest in equities since January 2013. That being said, there are signs that demand may be waning as a shift in US monetary policy looms larger. For example, data from stock exchanges in six countries in Emerging Asia suggest overall net foreign purchases have been a lot less in September than in recent months. And emerging market equities more generally have come under pressure in the past few weeks, underperforming developed market equities again after a more favourable summer.
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