Investor interest last week in the tax-exempt market, as reflected by municipal bond mutual fund flows, continued to be strong.
For the week ended Jan. 25, muni bond funds saw $513 million of inflows from funds that report their flows weekly, according to Lipper FMI. That’s roughly half the amount seen in the week ending Jan. 18, when there were net inflows of $1.01 billion.
It marks the eighth straight week of positive flows, and the 19th week out of the past 21.
Muni yields saw a series of jumps early in the week, only to strengthen on Wednesday following Federal Reserve chairman Ben Bernanke’s announcement that interest rates would remain low through 2014.
Treasury yields had a better week on the short and intermediate parts of the curve.
This past week, assets for funds that report their flows weekly fell slightly to $279.4 billion from $280.1 billion the previous week. It was the first decrease in four weeks.
The value of the holdings for weekly reporting funds decreased by $839 million. The week before, they increased by almost $2 billion.
The four-week moving average for all municipal bond mutual funds that report their flows weekly saw a $789 million inflow, up from a $751 million gain the week before.
High-yield muni funds saw relatively modest inflows. They have been in the black for seven of the past eight weeks.
Funds that report weekly saw inflows of $91 million, Lipper said. The previous week, high-yield funds reported inflows of $265 million.
Assets for high-yield funds that report their flows weekly fell after five straight weeks of increases. They ended at $35.33 billion, down from $35.70 billion the previous week.
The value of the holdings for weekly reporting funds decreased by $71.1 million. Last week, they rose by $370.3 million.
The four-week moving average for all high-yield muni bond funds that report their flows weekly was a $152 million inflow, up from an $134 million inflow the week before.
