The $3.6 billion Schwab Municipal Bond ETF, ticker SCMB, has suffered more than $530 million in investor withdrawals this month, its largest monthly outflow since inception in 2022. Outflows accelerated last week with a single-day redemption of $360 million, identified in the earlier account as occurring on September 14-15 and representing roughly 9% to 10% of the fund’s assets. The selling followed a fixed-income market sell-off that pushed municipal bond yields to multi-month highs. The 10-year Treasury yield rose from 3.9% in late February to 5.0% by mid-September, a gain of about 110 basis points, pressuring municipal bond prices and longer-duration holdings. Municipal ETFs recorded $561 million in weekly net outflows, while investors rotated toward shorter-duration products such as the Vanguard Tax-Exempt Bond ETF, or VTES, and the JPMorgan Ultra-Short Municipal Income ETF, or JMST. The municipal market has returned approximately negative 1.7% year to date, while issuance reached nearly $430 billion through early September, the highest level for that period on record, according to Bloomberg data. SCMB charges a 0.03% expense ratio. The scale of the redemption suggests that a large allocator reduced municipal exposure, while competition from 5.0% Treasury yields and heavy new supply continued to weigh on demand.