Money Market Funds See Heaviest Inflows in 18 Months
Tuesday, July 13, 2010 15:41
Investors have poured tens of billions of dollars this week into money market funds, which is considered to be among the safest assets, amid fears that a double-dip recession in the developed world could send financial markets tumbling.
According to the research group EPRFR Global, it is said that the global funds, which are seen as a proxy for cash, enjoyed their biggest weekly inflows in 18 months, absorbing $33.5bn. Some of the world’s biggest fund managers held as little as 5% of cash in their portfolios before the financial crisis. Now they are holding up to 40%.
The fear of a debt default by one of the weaker eurozone countries, the slowing growth in China and doubts over the strength of the US recovery, have emerged as the main threats to the global economy.
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