Investors pulled more money from municipal bond mutual funds last week than they have all year.
Those funds that report flows weekly recorded outflows of $1.47 billion for the week ending June 5, Lipper FMI numbers showed. That compares with outflows of $157 million from weekly reporting funds for the period ending May 29.
Munis staggered through another challenging week. Relatively light primary market volume met an unreceptive investor base, requiring concessions to clear deals.
The secondary market was mostly quiet. Muni yields beyond the front end of the curve rose two to four basis points on the week from last Friday while those of Treasuries fell modestly across the curve.
The 10-year triple-A tax-exempt yield rose two basis points on the week from Friday to 2.11%, Municipal Market Data Numbers showed. The 30-year climbed four basis points to 3.28%, while the two-year inched up one basis point to 0.30%.
Munis crossed over into cheaper territory relative to Treasuries on the week from Friday. Ratios beyond the front end of the curve sit just above 101%. The two-year rose over the period to 100%.
As for the pullout, investors who only follow their fund's progress monthly might have only just realized how badly May went on their month-end statement, one muni analyst tweeted.
Assets for all muni funds that report their flows weekly fell to just under $324 billion. The previous week they reported $326.2 billion.
The value of the holdings for weekly reporting funds plunged by $755 million. The week before, they plummeted by $1.98 billion.
The four-week moving average for all municipal bond mutual funds that report their flows weekly was $315 million of outflows, compared to $59 million of inflows the week before.
Outflows hemorrhaged from long-term bond funds that report their flows weekly.
The outflows continued for a 14th straight week, at $1.28 billion. They reported $304 million of outflows last week.
High-yield muni funds continued to sustain heavy outflows.
Those high-yield funds that report flows weekly had $501 million in outflows, Lipper said.
The previous week, they reported $166 million in outflows.
Assets for high-yield funds that report their flows weekly fell to $44.98 billion, from $45.66 billion reported the week before.
The value of the holdings for high-yield funds dropped by $186 million. Last week, they dove by $310 million.
The four-week moving average for all high-yield municipal bond funds that report their flows weekly showed $184 million of outflows, falling from $76 million of outflows the week before.