Debt mutual fund witnesses outflow of Rs 32,722 crore in May

Mumbai: The new outflow from the debt mutual funds in India crossed Rs 32,722 crore in May. The data released by the Association of Mutual Funds in India (Amfi) revealed this. As per the data, in April the mutual funds witnessed an inflow of Rs 54,656 crore. Also, there has been a reduction in the number of folios from 73.43 lakh to 72.87 lakh folios between April and May 2022.

As per experts, a volatile macro environment like rising interest rates, rising food, commodity and fuel prices and higher yields have likely impacted investors’ investing preferences within debt markets.

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Debt funds have always been considered as a safer investment option, especially during volatile markets. Out of the 16 fixed-income or debt fund categories, 12 witnessed net outflows in May. The net inflows were seen only in 4 categories — Overnight Fund, Liquid Fund, Gilt Fund & Gilt Fund — with 10 year constant duration.

Money market funds saw an outflow of Rs 14,598 crore in this category, followed by short-duration funds (Rs 8,603 crore), ultra-short-duration funds (Rs 7,105 crore) and low-duration funds (Rs 6716 crore).