The Big Exodus From Muni-Bond Funds Isn't Cause for Concern Yet
- The $830 million pulled last week was most since January 2017
- Outflow probably caused by tax payments, not sentiment shift
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Don’t get too worried just yet that investors are about to begin stampeding out of the municipal-bond market.
Investors pulled about $830 million out of state and local government bond mutual funds during the week ended April 11, the biggest outflow since January 2017 and the second straight week of investors pulling cash, according to the Investment Company Institute. Municipal analysts and investors have fretted over the possibility that the year’s poor start could cause a prolong run of outflows, posing a potential threat to a market that’s already delivered negative returns this year.