Municipal New Issuance: This past week the negotiated calendar totaled to just over $5.2 billion for the week with the largest deal of the week being the $980 million Southeast Energy Authority issue followed by the $700 million San Diego Community College issue. AmeriVet participated in two issues this past week as a Selling-Group-Member, the first being the $172 million South Carolina State Housing Finance and Development Authority which issued Mortgage Revenue Bonds. AmeriVet also participated in the Selling-Group for the New Hampshire Housing Finance Authority which issued $75 million in tax-exempt bonds and $25 million in taxable bonds.

Municipal Secondary Trading: Due to the early close to commemorate President Carter’s Funeral last Thursday, secondary trading totaled to just over $31.29 billion with 50% of all secondary trading being dealer sells. According to Bloomberg, clients put up just under $2 billion for the bid. Clients put up just over $4 billion for the week with the largest volume of bids-wanted being on Tuesday with just over $1.06 billion in bids according to Bloomberg data.

Municipal Spreads: Muni yields rose this past week with yields rising by an average of 16.3 basis points with yields on 10-year notes rising by 14.5 basis points to end the week at 3.23%. With muni yields rising, munis did slightly underperform Treasuries as the 10-year muni-to Treasury ratio is now yielding 67.95% compared to the prior week when that ratio was at 67.21%. We also did see the 30-year muni rise above 4% for the first time since November 2023. With yields on the rise this past week, we did see the muni curve steepen by 19.1 basis points to 125 basis points.

According to LSEG Lipper US Fund Flows data, investors added roughly $842 million to muni bond funds this past week which follows the prior week’s outflow of $387 million, breaking four straight weeks of outflows.

Despite yields rising this past week by an average of 10.2 basis points across the curve, ratios continue to be on the rich side with ratios richening across the curve to the tune of 1-1.6 percentage points in the 2–10-year maturity range and .52 percentage points in the 30-year maturity. The release of the December employment report last month indicated that employment grew the most in nine months which caused a selloff in Treasuries with 30-year Treasuries hitting 5% for the first time in over a year. Munis yields also rose from this data with yields rising by an average of 6 basis points across the curve. The strong jobs data further pushes back any rate cuts to late third quarter or early fourth quarter of 2025. With CPI set to be released later this week on the 15^th, forecasts are showing a third straight month of acceleration of inflation which could push back another rate cut event further and push yields even higher.

Municipal Supply: The negotiated calendar for the week will have an expected volume of just over $10 billion, with the largest deal of the week being the $1.3 Triborough Bridge and Tunnel Authority issuance that will be issuing Real Estate Transfer Tax Revenue Bonds for MTA Bridges and Tunnels which AmeriVet will be participating in the Selling-Group. The second largest deal for this week will be the $996 million Airport commission of the City and County of San Francisco for the San Francisco International Airport. The Orange County Facilities Authority plans on selling $824 million in Hospital Revenue Bonds for the Orlando Health Obligated Group.