Investors fear sustained rate hikes, switch to liquid and overnight funds

G-sec yield has remained under pressure in the past few days due to the concerns over rising inflation and crude oil prices

Open-ended debt funds witnessed sharp outflows in May, led by high redemptions from the money market and short-duration funds. The data from the Association of Mutual Funds in India (Amfi) shows there were net outflows worth Rs 32,722.25 crore from debt funds last month.

Categories like overnight funds and liquid funds, on the other hand, saw net inflows of Rs 15,070.89 crore and Rs 1,776.88 crore, respectively, in May. Money market funds witnessed net outflows of Rs 14,598.65 crore; the figure for short-duration funds was Rs 8,603.03 crore.

Amid expectations of more rate hikes by the Reserve Bank of India (RBI) to