UPDATE 1-US muni bond fund weekly outflows narrow to $973.8 mln -Lipper
Aug 8 (Reuters) - U.S. municipal bond funds reported $973.8 million of net outflows during the week ended Aug. 7, a sharp decline from the previous week's $2.24 billion of net outflows, according to data released by Lipper on Thursday.
The four-week moving average remained negative at $1.5 billion in outflows, said Lipper, a unit of Thomson Reuters.
Although outflows narrowed considerably from a week ago, investors eyeing gains on Wall Street and Detroit's bankruptcy filing remain wary of tax-free debt and have pulled more money from municipal bonds than they have invested for 11 straight weeks, according to Lipper.
Investors in the municipal bond market also worry the Federal Reserve will soon end its monetary stimulus program, which would likely hurt bond prices.
Funds that hold high-yield municipal bonds, which usually have lower ratings, also had slower net outflows during the latest week, at $209.4 million. Net outflows a week earlier were $580.18 million, Lipper said.
There were $13.9 million in outflows from exchange-traded funds, compared with the $56.86 million investors withdrew on a net basis from funds in the previous week.
Buying interest among investors for individual bonds picked up, according to data from BondDesk Group LLC. Retail investors bought 2.3 municipal bonds for every one they sold in the week ended August 7, an increase from the 2.2 posted during each of the previous three weeks. The number of bonds bought totaled 86,057, while the number of bonds sold was 37,070.
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