Amid the global jitters about a possible unwinding of U.S. monetary stimulus, there's one asset that appears to be gaining favor and that's dollar exchange traded funds (ETFs), analysts say.
Equities in the U.S., Europe and Asia have been pushed off multi-year highs, while government bond yields have risen sharply as investors brace for a potential unwinding of the Fed's asset-buying program in the months ahead.
In contrast, money has been flowing into U.S. dollar ETFs, investment funds that trade on exchanges in the same way stocks do, says Peter Harper, director of distribution at BetaShares Capital in Sydney.
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"Over the last six months people have wanted to buy U.S. assets as markets there recovered and now we are starting to see a switch, with investors becoming a little bit more cautious in case QE [quantitative easing] gets pulled so we are seeing inflows into U.S. dollar ETFs," Harper told CNBC Asia's
"What we have here is that in a situation where QE might get pulled, this would be positive for the dollar but potentially negative for U.S. assets," he said.
According to Harper, there have been more than $35 million worth of inflows into U.S. dollar ETFs in the past month.
"There's a lot of reason to think that if the Fed pulls back on its money printing that will be positive for the dollar," he said.