Emerging Market Asia portfolio flows remain volatile

SINGAPORE - There was a distinct divergence in foreign portfolio flows into Asia ex-China in April, with equities recording the largest monthly inflow since March 2017 and the debt market experiencing the largest broad-based outflows since November 2016.

ANZ Bank says improving China economic activity partly helped spur equity inflows into the region, although the numbers were also inflated by a one-off takeover deal in Indonesia.

"The debt outflows look to be more country-specific, ranging from election-related positioning changes in India to reactions to Norway's sovereign wealth fund dropping emerging market (EM) bonds from its fixed income benchmark," ANZ said.

"Given new uncertainty over US-China trade talks, foreign portfolio flows could remain volatile in the near-term."  www.live.anz.com (ATI).