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AmeriVet Weekly Muni Snapshot

Municipal New Issuance: Last week’s negotiated calendar totaled to just under $9.7 billion for the week with the largest deal being the $2.6 billion State of California GO issuance which AmeriVet was in the Selling-Group. AmeriVet also participated as a Selling-Group-Member on the $1.4 billion New York City GO issuance which was the second largest deal last week. The third largest deal of the week was the $1.1 billion State of Washington issuance.

Municipal Secondary Trading: With just four trading days last week due to the Good Friday Holiday, secondary trading totaled to roughly $29.68 billion for the week with 54% of trades being dealer sells to clients. According to Bloomberg, clients put up roughly $4.6 billion up for the bid last week compared to the prior weeks figure of $6.9 billion.

Municipal Spreads: For the second week in a row, we saw muni yields rise with 10-year notes rising by 3.4 basis points to end the week at 2.51%. With the rise in yields this past week, we did see the 10-year muni-to-Treasury ratio rise to 59.89% compared to the prior week when the ratio was at 59.11%. The muni curve did flatten this past week by 6.3 basis points to 74 basis points.

According the LSEG Lipper Global Fund Flows data, municipal bond mutual funds continue to see inflows as investors added roughly $447 million to municipal bonds funds last week. This follows last week’s inflow of $64 million and marks the sixth straight weeks of inflows.

With the first quarter of 2024 over, munis continue to be down for the year with munis down roughly .39% for the year with March returns for munis being flat for the year. With Treasuries having returned about .63% for the month and munis down for the month, ratios have inched closer back to the average levels we are used to seeing with the 10-year now above 60%. At the start of the quarter, the 10-year ratio was at 58.48%. This underperformance in recent weeks is due to investors selling ahead of the tax return deadline of April 15th and not due to the lack of demand for munis.

Municipal Supply: This week, the negotiated calendar will have an expected volume of $4.1 billion for the week, with the largest deal being the $918 million State Public Works Board of the State of California. The issue will consist of taxable and tax-exempt bonds and AmeriVet will be participating as a Co-Manager. The second largest deal of the week will be the $500 million Cornell University taxable issue which will be using a corporate cusip. AmeriVet will be in one other issue as a Selling-Group-Member which will be the $75 million New Hampshire Housing Finance Authority which will consist of taxable and tax-exempt bonds.