“The decline in the mutual fund inflows was most likely due to the consumer spending exuberance and a volatile first quarter on the financial markets that made investors cautious,” said Razvan Szilagyi, general manager of Raiffeisen Asset Management, the second leading actor on its market with RON6.6 billion assets under management.
“The financial markets are flooded with liquidity and this clearly encourages consumer spending rather than saving money in banks or mutual funds.”
Last year’s yields were no help, either, given the average of -0.5% across the market.
The local industry of mutual funds ended the first quarter with RON21 billion assets under management, an increase of 0.2% on the beginning of the year, according to the statistics of the Fund Managers Association (AAF). The inflows this year are very low, considering net inflows in the first quarter of 2015 stood at RON1.1 billion and mutual fund assets went up 8%. The stock market was flat in the first quarter of 2015, compared with a 4% decline in the first quarter of 2016. Moreover, the second half of 2015 saw a number of steps taken that encouraged consumer spending, such as the VAT cut and the public sector salary raises by up to 25%.
(English version by Loredana Fratila-Cristescu)