Municipal New Issuance: Last week’s negotiated calendar totaled just over $8.3 billion, with the largest deals being the $2.6 billion State of California GO issue which AmeriVet participated in the Selling-Group. The Illinois Finance Authority issued $856 million for the State of Illinois Clean Water Initiative Revolving Fund and the California Educational Facilities Authority issued $600 million in Revenue Bonds for the University of Southern California.

Municipal Secondary Trading: Secondary trading for the week totaled to approximately $45.82 billion with 51% of all secondary trading being dealer sells and the bulk of the volume of secondary trading being executed on Thursday. The selloff in equities, mainly due to the tariffs, pushed investors into safer investments. According to Bloomberg, clients put roughly $6.91 billion up for the bid, down from the prior week’s bids-wanted volume of $7.25 billion.

Municipal Spreads: Munis rallied over the past week as muni yields followed the rally of US Treasuries as investors moved to safer asset classes as the new tariffs took into effect on Thursday. Munis saw bumps of about 28.4 basis points across the curve with 10-year yields seeing about 29.7 basis point bumps to end the week at 2.95%. With the strong rally in munis, we did see munis outperform Treasuries as the 10-year muni-to-Treasury ratio is now yielding 73.71%, compared to the prior week when the ratio was at 76.44%. We did see the muni curve flatten by 3.8 basis points to 157 basis points.

Investors pulled approximately $232 million from muni bond funds last week according to LSEG Lipper Global US Fund Flows data. This follows the prior week’s outflow of $573 million and marks the fourth consecutive weeks of outflows.

With the tariffs in place and fueling concerns of a recession, investors flocked to safer assets classes such as Treasuries and munis. Muni yields dipped as much as 28 basis points last week. With the rally this past week, munis were able to return roughly 1.48% for the first few days of April, bringing year-to-date returns back into positive territory at 1.26%. The rally last week comes off of the negative performance during the month of March when bonds fell by 1.7% as supply outweighed demand and investors selling to pay their taxes. In the two trading days since the tariffs were imposed, we saw muni yields fall by an average of 20 basis points across the curve with the belly of curve seeing a drop of about 21-basis points. We did see the muni-to-Treasury ratio richen as well over the past week as we saw an average of a 1 percentage point drop across the curve as investors took advantage of cheaper munis.

Municipal Supply: This week, the negotiated calendar will have an expected volume of about $8.9 billion with the largest deal being $1.5 billion New York City GO which AmeriVet will be participating in the Selling-Group. The second largest deal of week will be the Bon Secours Mercy Health will issue $890 million of Hospital and Health Facility Revenue Bonds for systems in Ohio, South Carolina, and Virginia. AmeriVet will be serving as a Co-Managing Underwriter for the State Public Works Board of the State of California which will be issuing $688 million in Lease Revenue Bonds with $585 million being tax-exempt, and $103 million being taxable. Additionally, the State of Oregon will be issuing $466 million of Oregon State Lottery Bonds.