BlackRock, Vanguard Municipal Bond ETFs Post Record Weekly Inflows After Selloff

BlackRock Inc.'s $46 billion iShares National Muni Bond ETF (MUB) drew about $1.2 billion last week, while Vanguard Group's $47 billion Tax-Exempt Bond Index ETF (VTEB) attracted $1.7 billion — the largest weekly inflows on record for both funds, according to Bloomberg data. The surge followed a municipal bond rout that drove redemptions across other muni funds. Ten-year benchmark muni yields climbed to their highest since April 2025 on Monday, and 30-year yields earlier this month hit their highest since 2011, pressured by rising Treasury rates and heavy new issuance. Vanguard's Nathan Will attributed demand to an attractive yield environment and tax-equivalent yields hard to match elsewhere in fixed income. SWBC's Chris Brigati cited tax-loss harvesting, noting investors are using the ETFs to remain invested while seeking swap candidates. Muni market year-to-date returns are down about 1.9%.