January 16, 2014 / 10:51 PM / 4 years ago

UPDATE 1-U.S. muni bond funds post $103.3 mln in inflows-Lipper

WASHINGTON, Jan 16 (Reuters) - U.S. municipal bond funds posted inflows of $103.3 million, their first net inflows in eight months, in the week ended Jan. 15, according to Lipper data released on Thursday that showed investors poured money into high-yield funds.

Last week’s outflows of $19 million capped 33 straight weeks of net outflows - the longest string of redemptions on record as kept by Lipper, a Thomson Reuters company.

This week’s sea change happened mostly high-yield funds, typically consisting of riskier debt, which had net inflows of $276.4 million. They also had inflows, $50 million the previous week.

Altogether, the four-week moving average for municipal bond funds remained negative at $719.8 million this week.

A relentless selloff sucked a record $62.6 billion out of municipal bond funds in 2013, as investors were spooked by interest rate risk but also lured by higher returns in the stock market. Now armed with cash from year-end redemptions, investors have recently returned to take advantage of the sector’s rich yields.

Exchange-traded funds, too, saw inflows, $45.9 million, this week after last week’s inflows of $45.6 million.

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