Investors Pull $1.8 Billion From US Municipal Bond Market Amid Rate Concerns

Investors withdrew about $1.8 billion from the US municipal bond market for the week ending Wednesday, marking the largest outflow since April 2025 and ending a 21-week inflow streak.

The outflow was driven by inflation concerns, rising Treasury rates, and heavy new issuances, pushing year-to-date muni returns down approximately 1.7% according to Bloomberg data.

Bids-wanted lists surged to about $2.5 billion, the highest since April 2025, as volatility reduced fixed income price stability and prompted investors to liquidate holdings.