US Leveraged Loan Funds See 10th Week of Inflows, $3.5B Since May
US leveraged loan funds have attracted $3.5 billion in inflows since May, marking a 10-week streak. The recovery follows a sell-off in February-March, driven by easing Iran tensions and higher rate expectations.
Leveraged loan funds in the US have recorded $3.5 billion in inflows since the start of May, extending a winning streak to ten consecutive weeks. This marks a sharp reversal from the February-March period, when weekly outflows peaked at $1.6 billion.
The rebound is attributed to easing fears over a wider Iran conflict, which has improved risk appetite. Additionally, expectations that interest rates will remain elevated are making floating-rate leveraged loans more attractive to investors.
Separately, investment-grade corporate bond funds have posted 13 consecutive months of inflows, with May alone seeing $39 billion. The data suggests a broad return of confidence to credit markets.
Source: The Kobeissi Letter