Follow The Flow: Barbelling flows

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Follow The Flow: Barbelling flows

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Follow The Flow

Barbelling flows

Into government and EM debt, struggling HY funds 15 May 2026

Over the past three months, amid rising geopolitical tensions, we have seen a barbelling Credit Strategy

tendency to flow trends. EM debt and government bond funds have been seeing strong Europe

inflows, while credit funds have been lagging overall. Although rates vol has declined Ioannis Angelakis

recently, supporting a rebound in credit flows, the ascent of high “risk-fee” yields has Credit Derivatives Strategist

been instrumental in the flows into government bond funds. At the same time, money MLI+44 (UK)20 7996 0059

market funds have also struggled as steep curves incentivise investors to reach duration ioannis.angelakis@bofa.com

via government debt vis-à-vis short-term assets (like money-market funds). Barnaby Martin

Credit Strategist

Over the past week… MLI+44 (UK)20 7995 0458

High grade funds continued to attract more inflows for the third week in a row. Mid- barnaby.martin@bofa.com

term funds led the pack and have now seen five weeks of inflows. Note this is the first Mohit Agarwalla Credit Strategist

time in 12 weeks that we have seen inflows across short, mid- and long-term funds. MLI (UK)

mohit.agarwalla@bofa.com

High yield funds recorded their fifth consecutive weekly inflow, after seven weeks of

outflows. For European-domiciled funds, Euro-focused HY funds saw inflows, while

global- and US-focused funds suffered small outflows. HY ETFs benefited from broader

risk-on and recorded inflows for the second week in a row.

Table 1:Weekly and YTD European

Exhibit 1: EM debt and gov’t bond funds have been leading the way since the second half of Feb

retail flows Cumulative weekly flows in % of AUM terms