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State Street Global Markets released the results of the State Street Institutional Investor Indicators for September. The State Street Risk Appetite index fell to -0.18 from 0, showing that, on balance, long-term investors were reducing risk across asset classes in September.
“As bond markets sought to fully price in higher for longer rates from the Federal Reserve and equity markets wobbled, we saw a classic risk off response from long-term investors. There was a sharp rise in allocations to cash, stronger demand for the US dollar and significant outflows from cyclical and emerging market assets.
“Perhaps the only surprise given the price action is that long-term investor flows into Treasuries, as well as other core sovereign bonds, remained strong....
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