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UK-based investors pull record $2.2 billion from equity funds in August-Calastone

·1-min read

LONDON (Reuters) - UK-based investors pulled a record net 1.93 billion pounds ($2.23 billion) from equity funds last month, surpassing records set in the aftermath of Britain's vote to leave the European Union in 2016, fund network Calastone said on Monday.

"Markets are absorbing the likelihood that inflation will be extremely pernicious and persistent, meaning that interest rates will stay higher for longer than initially expected," said Edward Glyn, head of global markets at Calastone.

"The combination of a weaker economy and higher rates is very negative for share prices, especially of growth stocks."

However, funds focused on renewable energy saw inflows, as did equity funds with an environmental, social and governance slant, Calastone said, as economies suffer from soaring gas prices.

More than two-thirds of UK-based fund flows by value pass across the Calastone network each month.

($1 = 0.8656 pound)

(Reporting by Carolyn Cohn; editing by Jonathan Oatis)