UPDATE 1-U.S. muni funds weekly outflows widen to $1.2 bln-Lipper
Aug 15 (Reuters) - U.S. municipal bond funds reported $1.206 billion of net outflows during the week ended Aug. 14, versus the previous week's net outflows of $973.8 million, according to data released by Lipper on Thursday.
The four-week moving average remained negative at $1.41 billion in outflows, said Lipper, a unit of Thomson Reuters.
Investors eyeing gains on the equity market and Detroit's bankruptcy filing remain wary of tax-free debt and have pulled more money from municipal bonds than they have invested for 12 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 amid expectations of rising interest rates.
Funds that hold high-yield municipal bonds, which usually have lower ratings, had $216.5 million of net outflows during the latest week. Net outflows a week earlier were $209.4 million, Lipper said.
But investors using exchange-traded funds ended a streak of outflows and posted net inflows for the week of $3.82 million, compared with the $13.9 million investors withdrew on a net basis from funds in the previous week.
Buying interest for individual bonds remained steady, according to data from BondDesk Group LLC. Retail investors bought 2.3 municipal bonds for every one they sold in the week ended Aug. 14, the same pace as during the previous week. The number of bonds bought totaled 85,417, while the number of bonds sold was 36,786.
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