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Bailey McCann, Opalesque New York:

Emerging market funds are taking a significant hit as fears that China's devaluation of the renminbi, which slid over 3% versus the US dollar between August 11 and August 14, is evidence of greater than feared weakness in the world's second largest economy. According to new data from EPFR, redemptions from Emerging Markets Equity Funds climbed to a five week high as investors pulled money out of this fund group for the sixth consecutive week and outflows from Emerging Markets Bond Funds hit their highest level since early 1Q14.

As Opalesque reported earlier this week, fund managers are significantly scaling back their expectations for economic growth. A Chinese recession is being factored in by more than half of fund managers in a recent BAML survey.

EPFR data show that China Equity Funds were the biggest contributors to the overall outflows from Asia ex-Japan Equity Funds as the pace of redemptions accelerated with domestic institutional investors again leading the way.

"The prospect of Asian rivals armed with more competitive currencies chased more money out of Mexico Equity Funds while concerns about Chinese demand for raw materials saw Brazil Equity Fund outflows climb to a 10 week high. In the case of Brazil, support from diversified ......................

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