NET capital flows to Asia have turned negative, partially reversing the net inflows since 2010, the Monetary Authority of Singapore (MAS) said in its annual Financial Stability Review on Thursday.
According to the report by the central bank's Macroeconomic Surveillance Department, several Asian economies have received substantial financial flows in the past few years as Asian sovereigns and corporates benefited from historically low risk premiums and global volatility.
During the episodes of tapering shocks in late 2013 and early 2014, exits from Asia-10 equities and bonds were driven mainly by retail funds, while institutional funds maintained or even increased holdings, reflecting longer-term optimism over growth prospects in emerging Asia.
"Looking ahead, uncertainty in the timing of interest rate rise in the US is likely to lead to greater volatility in Asian capital flows,'' it said.
"Asia-10'' comprises China, Hong Kong, India, Indonesia, Korea, Malaysia, the Philippines, Singapore, Taiwan and Thailand.