Flows to municipal bond mutual funds remained positive for a seventh straight week, but only modestly so.
Those muni bond funds that report their flows weekly recorded $292 million in inflows for the week of Feb. 20, Lipper FMI numbers showed. The previous week, they weighed in at $491 million.
The muni market had a mediocre week. Most of the new issuance for the holiday-shortened week arrived Wednesday, only to be absorbed with concessions of up to 10 basis points. In addition, a quiet tone colored the secondary market pretty much until Thursday, when traders reported decent activity.
Tax-exempt yields underperformed those of their Treasury brethren on the week, though only modestly. The triple-A 10- year made the largest move, Municipal Market Data numbers showed, rising five basis points since last Friday to 1.90%. The 30-year increased two basis points to 2.94% over the same period, while the two-year slipped one basis point to 0.31%.
Treasury yields mostly fell one or two basis points across the curve. Muni ratios to Treasuries barely budged on the week, rising only slightly. Those ratios at the 10-year and 30-year section of the curve have been hovering around 90% to 95%.
Assets for all muni funds that report their flows weekly climbed this past week to $326.6 billion. The week prior, they reported $326.2 billion.
The value of the holdings for weekly reporting funds rose by $21 million. The week before, they fell by $330 million.
The four-week moving average for all municipal bond mutual funds that report their flows weekly was $366 million of inflows, falling from $511 million the week before.
Long-term bond funds that report their flows weekly saw inflows for the week at $133 million. That represented a small drop from the $235 million of inflows they reported the week before.
High-yield muni funds also reported inflows for a seventh straight week, though they barely qualified as such. For context, flows were positive for most of last year.
High-yield funds that report weekly saw just $42 million in inflows, Lipper said. The previous week, they reported $106 million in inflows.
Assets for high-yield funds that report their flows weekly rose for a eighth straight week to $45.35 billion, up from $45.26 billion the week before.
The value of the holdings for weekly reporting high-yield funds rose by $38 million. Last week, they fell by $42 million.
The four-week moving average for all high-yield municipal bond funds that report their flows weekly showed $63 million of inflows, falling from $122 million of inflows the week before.