March 14, 2019 / 11:20 PM / 6 months ago

UPDATE 1-U.S. investment-grade corporate bond funds enjoy 7th week of inflows -Lipper

 (Adds quote from senior research analyst, table)
    By Jennifer Ablan
    March 14 (Reuters) - U.S.-based investment-grade corporate
bond funds pulled in more than $3.29 billion in their seventh
straight week of inflows, Lipper research service said on
Thursday, as the Federal Reserve is expected to affirm its
patience in considering interest rate hikes.
    Other credit market sectors also enjoyed inflows in the week
ended March 13, according to the Refinitiv unit. U.S.-based
municipal debt funds attracted more than $1.2 billion, for a
10th consecutive week of inflows. Taxable bond mutual funds
brought in over $585 million for their ninth straight week of
net new money.
    "Money started to flow into (the corporate bond) asset class
when the Federal Reserve took their foot off the gas at the
start of the year in regards to their interest rate hike and
balance sheet reduction policies," said Pat Keon, senior
research analyst at Lipper.
    The Federal Open Market Committee meeting on March 19-20 is
fueling demand for corporate bonds, he added.
    Fed Chairman Jerome Powell and the Fed's policy-setting
committee are expected to reiterate that they are in no hurry to
adjust interest rates as growth slows and inflation stays muted.
    U.S. equity mutual funds suffered net outflows of $3.4
billion, Lipper said, noting this week marked the category's
fourth straight week of cash withdrawals. However, U.S. equity
mutual funds are still up for the year at $5 billion.
    "That is a significant rebound from the $102 billion in net
outflows during the fourth quarter 2018," Keon said.
    Money market funds had net outflows of $2.2 billion, but
"these results were somewhat muted when compared to the usual
volatility we see from this group," Keon added.
    The following is a breakdown of the flows for the week,
including mutual funds and ETFs:
 Sector                  Flow Chg   Pct of    Assets      Count
                         ($ blns)   Assets    ($ blns)    
 All Equity Funds        0.891      0.01      7,238.087   12,108
 Domestic Equities       1.994      0.04      5,152.584   8,585
 Non-Domestic Equities   -1.104     -0.05     2,085.503   3,523
 All Taxable Bond Funds  2.623      0.09      2,828.980   5,968
 All Money Market Funds  -2.210     -0.08     2,886.622   1,008
 All Municipal Bond      1.646      0.37      446.918     1,410
 (Reporting by Jennifer Ablan; Editing by Richard Chang)
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