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U.S. High-Grade Bond Funds Reap Record $8.2 Billion Inflow

Allan Lopez

(Bloomberg) -- Investors poured a record amount of cash into U.S. corporate investment-grade bond funds this week, shrugging off geopolitical concerns.

The influx of $8.19 billion for the weekly period ended Jan. 8 reverses outflows seen in the previous week, according to data compiled by Refinitiv Lipper. The inflow handily beats the previous record of $6.9 billion investors added in the week ended Oct. 8, 2014, in data going back to 1992.

Blue-chip companies have sold almost $62 billion of bonds this week, to take advantage of low borrowing costs. Risk premiums of for investment-grade notes are hovering near the lowest in almost two years. The Bloomberg Barclays OAS spread index closed Wednesday at 97 basis points, while all-in yields are hovering around 2.86%, near lows seen in mid-2016.

Separately, junk bond funds pulled in $1.12 billion for the week. U.S. high-yield debt issuance has been dominated by energy firms this week as West Texas crude hit an eight-month high earlier this week.

--With assistance from Michael Gambale and Rizal Tupaz.

To contact the reporter on this story: Allan Lopez in New York at alopez11@bloomberg.net

To contact the editors responsible for this story: Nikolaj Gammeltoft at ngammeltoft@bloomberg.net, Christopher DeReza, Dan Wilchins

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