The municipal bond market recorded a solid week of inflows to mutual funds, breaking a four-week string of dwindling demand.
Flows were positive for a sixth consecutive week, at $490 million, for the week of Feb. 13, Lipper FMI numbers showed. That compared with inflows of $109 million the week ended Feb. 6.
For the year to date through Feb. 6, muni bond funds have seen $6.4 billion in inflows, Lipper numbers show. This includes $3.0 billion to long-term muni funds and $1.2 billion to high-yield muni funds.
Muni yields experienced a small selloff on the week since last Friday beyond the front end of the curve. Relatively low volume reached the primary market, while traders described activity in the secondary as slow.
Muni ratios to Treasuries from 10 years on out barely budged, as those for the 10-year and 30-year continued to float just north of 90%. Treasury yields also backed up modestly over the span.
Assets for all muni funds that report their flows weekly edged up this past week to $326.2 billion. The week prior, they registered $326.1 billion.
The value of the holdings for weekly reporting funds fell by $330 million. The week before, they rose by $688 million.
The four-week moving average for all municipal bond mutual funds that report their flows weekly was $511 million of inflows, down from $749 million the week before.
Long-term bond funds that report their flows weekly reported inflows for the week at $235 million. That represented an increase from the $21 million of outflows they reported the week before.
High-yield muni funds also reported inflows for a sixth straight week. They were in the black for most of last year.
High-yield funds that report weekly saw $106 million in inflows, Lipper said. The previous week, they reported just $22 million in inflows.
Assets for high-yield funds that report their flows weekly rose for a seventh straight week to $45.26 billion, up from $45.20 billion the week before.
The value of the holdings for weekly reporting high-yield funds fell by $42 million. Last week, they rose by $129 million.
The four-week moving average for all high-yield municipal bond funds that report their flows weekly was $122 million of inflows, sliding a bit from $204 million of inflows the week before.