Tax-free money market funds caught a small breather last week with their smallest outflow in a month.

Tax-free money funds coughed up $760 million during the week ended Aug. 2, according to iMoneyNet, bringing total assets to $345.4 billion.

They had reported an average of nearly $2 billion in outflows a week for the past three weeks.

Funds continue to suffer from low yields on the investments they hold. The average tax-free money fund yields just 0.04%, according to iMoneyNet. That is despite an uptick in the Securities Industry and Financial Markets Association index tracking average rates on municipal variable-rate debt obligations to 0.28%, up from 0.15% the first week of the year.

Assets for the money fund industry overall — including the taxable fund space — leaped $7.83 billion after jumping $8.58 billion the previous week.

Money market funds manage a totalof $2.79 trillion.

Figures from the Investment Company Institute paint a different picture of tax-free flows than iMoneyNet’s. ICI data shows the industry reported an inflow of $3.1 billion during the week ended Aug. 4.

According to ICI, municipal money market funds reported $92.6 billion in outflows last year, and have reported $50.6 billion this year.

Assuming the average pace this year holds constant, investors are on track to withdraw about $85 billion from tax-free money funds in 2010.

While the tallies of assets at tax-free money market funds from ICI and iMoneyNet are within $1 billion of each other, flow figures often differ materially.

Whether it is because iMoneyNet measures weeks ending on Mondays and ICI measures weeks ending on Wednesdays, or because of a difference in evaluating flows, the weekly flow figures have differed from each other by an average of $2.5 billion this year.

One week in January, they differed by more than $8 billion.

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