Though slipping somewhat from recent numbers, municipal bond mutual funds showed solid interest from investors.
For the week ended Feb. 8, muni bond funds saw $370 million of inflows from funds that report their flows weekly, according to Lipper FMI. That amount is down from the amount seen in the week ending Feb. 1, when there were net inflows of $502 million.
It marks the 10th straight week of positive flows, and the 21st week out of the past 23.
Muni yields during the past week underperformed those of Treasuries in the intermediate and long ends of the curve. The two-year triple-A muni yield scraped to a record low. The market continues to be driven by light supply, muni bond fund inflows, and shifting relative-value metrics.
The dark period of large municipal outflows is mostly fading into a bad memory. Many in the industry can still remember when money fled muni funds in huge chunks between mid-November 2010 and early June 2011, typically by more than $1 billion a week. In the week of Jan. 19, 2011, investors in weekly reporting funds withdrew more than $4 billion.
This past week, assets for funds that report their flows weekly rose after two straight down weeks to $284.1 billion from $278.4 billion the previous week.
The value of the holdings for weekly reporting funds decreased by $653 million. The week before, they had increased by $2.52 billion.
The four-week moving average for all municipal bond mutual funds that report their flows weekly saw a $599 million inflow, down from a $784 million gain the week before.
High-yield muni funds saw a small decrease in inflows. They have been positive for nine of the past 10 weeks.
Funds that report weekly saw inflows of $155 million, Lipper said. The previous week, high-yield funds reported inflows of $186 million.
Assets for high-yield funds that report their flows weekly rose for the ninth time in 10 weeks. They ended at $36.48 billion, up from $36.35 billion the previous week.
The value of the holdings for weekly reporting funds fell by $30 million. Last week, they increased by $436 million.
The four-week moving average for all high-yield muni bond funds that report their flows weekly was a $174 million inflow, down from a $203 million inflow the week before.