Municipal bond yields are so far capping an interesting year with a fine run to the holiday season.

The benchmark 10-year triple-A yield continues to explore richer territory — it has tumbled 64 basis points since Oct. 12 and 24 points in the past two weeks, according to the Municipal Market Data scale. It sits at a record low 1.94%.

The 30-year muni yield has fallen 21 basis points since December started, and six points over the week. Even the otherwise mild-mannered two-year yield has fallen 10 basis points since late October.

But this week they have underperformed Treasury yields, both on a nominal basis and as shown through bond indexes.

With Europe still struggling, Treasury yields have pushed lower, and munis have followed to some degree, said Jim Kochan, chief fixed-income strategist at Wells Fargo Funds Management Group.

Muni investors also expect to see the relatively large new-issue calendars of the past few weeks dry up very soon, he added.

The timing is tricky and is forcing difficult decisions, as investors have money they must put to use.

“You’re getting coupon and interest payments coming in now,” Kochan said. “And we saw good inflows coming in to muni funds last week. It’s frustrating for investors that want to find yield in these markets — they certainly don’t find them in triple-As anymore. But this is the market environment we’re going to live in, as long as Treasury yields stay this low.”

Muni yields would just as soon follow treasuries, MMD analyst Dan Berger wrote in a research post, but serial trading, in particular, hasn’t been the “bond grab” of previous sessions. And the approach of year-end may be affecting market flows, he added.

The Bond Buyer’s 20-Bond GO index of 20-year general obligation yields declined one basis point this week to 3.92%. This is its lowest level since Sept. 22, when it was 3.85%.

The 11-Bond GO index of higher-grade 20-year GO yields dropped two basis points this week to 3.65%, which is its lowest level since Sept. 22, when it was 3.58%.

The yield on the U.S. Treasury’s 10-year note dropped six basis points this week to 1.92%. It now sits at its lowest level since Sept. 22, when it was 1.71%.

The yield on the Treasury’s 30-year bond fell eight basis points this week to 2.92%, which is its lowest level since Nov. 22, when it was 2.91%.

Investors still aren’t thrilled with the low nominal yields, though they’ve come to understand the possibility they’ll be around for a while longer.

“They’re not happy about it,” Kochan said. “But what are your alternatives? You earn zero on cash equivalents and money market funds. The returns aren’t very generous, but they’re better than zero.”

Investors still find value in muni bonds. As a case in point, muni bond mutual funds that report their flows weekly saw almost $1.4 billion in inflows last week, their strongest numbers since March 2010. This would suggest that investors want a lot of the month’s coupon payments and other reinvestment flows to go back into the market.

The revenue bond index, which measures 30-year revenue bond yields, fell two basis points this week to 5.01%. It rests at its lowest level since Nov. 10, when it was 5.00%.

The Bond Buyer’s one-year note index declined two basis points this week to an all-time low of 0.27%. The previous record low had been 0.28% on July 20, 2011. The index began in July 1989.

The weekly average yield to maturity of the Bond Buyer municipal bond index, which is based on 40 long-term bond prices, declined five basis points this week to 4.95%. This is the lowest weekly average for the yield to maturity since the week ended Oct. 6, when it was 4.92%.

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