Inflows to municipal bond mutual funds ticked up this week, making it eight consecutive weeks in the red.
Funds that report their flows weekly recorded $324 million in inflows for the week of Feb. 27, Lipper FMI numbers showed. The previous week, they reported inflows of $293 million.
A surge of new issuance washed into a market thirsty for paper. Interest rose as the week progressed, demonstrated by falling yields beyond the front end of the curve. The triple-A 10-year fell nine basis points on the week to 1.81%, Municipal Market Data numbers showed. The 30-year fell three basis points and the two-year held its level over the same period, at 2.91% and 0.31%, respectively.
But tax-exempts mostly kept pace with their Treasury brethren, closing out the week from last Friday with equal parts outperformance and underperformance throughout different segments of the yield curve. As a result, muni ratios to Treasuries ended the period mostly unchanged, and still below 96% beyond the front end of the curve.
Assets for all muni funds that report their flows weekly rose this past week to $327.7 billion. The week prior, they reported $326.6 billion.
The value of the holdings for weekly reporting funds rose by $773 million. The week before, they increased by $21 million.
The four-week moving average for all municipal bond mutual funds that report their flows weekly was $304 million of inflows, falling slightly from $366 million the week before.
Long-term bond funds that report their flows weekly saw inflows for the week at $114 million. That represented a small dip from the $133 million of inflows they reported the week before.
High-yield muni funds also reported inflows for an eighth straight week. For context, flows were positive for most of last year.
High-yield funds that report weekly saw almost $70 million in inflows, Lipper said. The previous week, they reported just $42 million in inflows.
Assets for high-yield funds that report their flows weekly rose for a ninth straight week to $45.50 billion, up from $45.35 billion the week before.
The value of the holdings for weekly reporting high-yield funds rose by $74 million. Last week, they increased by $38 million.
The four-week moving average for all high-yield municipal bond funds that report their flows weekly showed $60 million of inflows, falling from $63 million of inflows the week before.