BofA's Hartnett says 'inflation hedges back on'

In his weekly flow show note, BofA analyst Michael Hartnett said Friday that inflation hedges are back on.

The analyst revealed that cash saw inflows in the past two weeks, with $104.1bn inflow to cash in the month to date. As a result, Hartnett said there has been "no exodus from cash."

Focusing on TIPS, he said they said the first inflow since August 2022, so it is "interesting to see inflation hedges back on after CPI 9% to 3% drop since autumn'22."

Elsewhere, there were tech inflows in the past six weeks, albeit the smallest inflow over the period in the past week at just $0.1 billion. Materials saw the largest inflow in the past 25 weeks and a $1.9bn inflow in the past two weeks" as investors position for improvement in China outlook ."

The analyst noted that the recent GDP data showed "the fastest nominal GDP recovery since WW2."

By Sam Boughedda

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