U.S. Fixed-Income Funds Attract $60 Billion in October Despite Bond Selloff
Key Facts
U.S. fixed-income exchange-traded funds drew $60 billion in net flows in October 2026, as flows to U.S.-listed funds reached $204.3 billion, according to ETF.com. The flows came during a month that saw a sharp bond selloff in the middle of the month and yields rise to levels not seen in several years, the report said. Bond prices partially recovered later in the month, it said. The figures show continued demand for fixed-income instruments during a month marked by volatility in the bond market. Total flows to U.S.-listed funds were more than three times those recorded by the fixed-income category.
U.S. equity funds led the flow categories in October, attracting $79 billion, compared with $60 billion for U.S. fixed-income funds, according to ETF.com. International equity funds drew $34.5 billion, while international fixed-income funds attracted $14.3 billion. U.S. fixed-income flows therefore fell short of domestic equity flows but exceeded flows to the international fixed-income category. These figures cover different fund categories and do not mean that all bond funds saw the same level of demand. The report’s total flows also include U.S.-listed funds across asset classes.
Among individual funds, the iShares National Muni Bond fund, known by the ticker MUB, recorded net flows of $6,134.57 million in October, according to ETF.com data. The iShares 0-3 Month Treasury Bond fund, ticker SGOV, also made the list, with net flows of $4,505.29 million. The figures show demand for municipal instruments and short-term Treasury bonds during the month. But the report does not establish that these two types led overall demand for U.S. fixed-income funds. The two funds’ flows remain part of the $60 billion total for the U.S. category, according to the report.
October flows came amid sharp moves in the Treasury market. The Associated Press reported that the yield on the 10-year U.S. Treasury fell to 4.93% on October 30, from 4.98% late in the previous day’s session. The yield had topped 5.30% earlier in the month, the news agency said. On October 7, it rose to 5.36%, nearing its highest level since 2002, according to an earlier AP report. On that day, the Treasury sold $39 billion of 10-year notes at auction. These levels trace the yield’s course during the month, from the peak cited on October 7 to its decline on October 30.
Long-term yields had risen over the preceding months. Reuters reported on October 12 that the 10-year Treasury yield had climbed about 130 basis points since late February, while the 30-year yield had risen 100 basis points over the same period. Reuters’ analysis linked the increase in long-term yields to mortgage-related hedging that added selling pressure to the bond market. In a separate report published on October 29, the Associated Press said the 10-year yield had been declining for most of the month after rising to its highest level since 2002. The agency said the average rate on a 30-year fixed mortgage was 7.24% that week. It noted that 10-year Treasury yields affect home-loan pricing.
A Reuters poll published on October 7 showed that the median forecast among about 60 strategists for the 10-year Treasury yield was 5.00% at the end of 2026, down about 30 basis points from the levels cited in the poll. The median forecast was 4.90% in six months and 4.75% in a year, according to the poll conducted from October 5 to October 7. These are strategists’ estimates published that month, not market yields recorded on those future dates. On inflation, September data showed the U.S. consumer price index rose 0.6% month over month and 3.7% year over year. The index excluding food and energy rose 0.3% during the month and 2.6% over the 12 months through September, according to the Bureau of Labor Statistics.
Attention now turns to U.S. labor-market data. The Bureau of Labor Statistics has set November 3 as the release date for September 2026 job openings data, while October data will be published on December 1. The bureau has also scheduled its October jobs report for November 6 and that month’s consumer price index for November 10, both at 8:30 a.m. Eastern time. These dates mark the next milestones on the U.S. data calendar after the fund flows recorded in October. September data showed headline and core inflation rising on both a monthly and annual basis, according to figures published by the bureau. The flow report covers net money entering funds during the month, while the yield figures describe Treasury market moves on their specified dates.