Municipal New Issuance: The negotiated calendar last week had a total volume of just over $11.5 billion with the largest deals of the week being the $1.1 billion Dormitory Authority of the State of New York, followed by the City of Atlanta which issued $1.1 billion of Water and Wastewater Revenue and Refunding Bonds. The Airport Commission of the City and County of San Francisco issued $796 million. AmeriVet participated in the Selling-Group for the the State of Connecticut which issued just over $792 million in tax-exempt GO bonds and $300 million taxable GO bonds this past week. AmeriVet served as a Co-Manager for the Massachusetts Housing Finance Agency which issued $142 million in tax-exempt bonds and $27 million in taxable bonds.

Municipal Secondary Trading: Secondary trading volume for last week totaled to just over $39.58 billion, with 55% of secondary trading being dealer sells. According to Bloomberg (MBWDPAR Index), clients put just over $4.91 billion up for the bid, which is a decrease from the prior week’s bids wanted total of $5.19 billion.

Municipal Spreads: Munis saw bumps again this past week with the curve seeing an average of about 10.8 basis points across the curve. We did see 10-year yields rise by 11.1 basis points this past week to end the week at 3.02%. Although yields rose this past week, munis were still able to outperform Treasuries as the 10-year muni-to-Treasury ratio is now yielding 66.11%, compared to 67.28 % from the prior week. We did see the muni curve steepen by 2 basis points to end the week at 194 basis points.

Muni bond funds continue to see positive fund flows as muni bond funds saw investors add about $1.3 billion to muni bond funds this past week This follows prior week’s inflow of $1.1 billion according to LSEG Lipper Global U.S. Funds Flows Data.

As we reach the halfway point in the month, munis were weaker this past week as they continue to face upward pressure across the curve with 10-year muni yields pushed above 3.00% for the first time since September of last year this past week. Munis followed suit with the Treasuries moving higher following inflation data and continued geopolitical tensions in the Middle East. Investors continue to grow increasingly concerned with sticky inflation and rising oil prices which could delay any future rate cuts, pressuring both taxable and tax-exempt fixed income markets. AAA muni yields rose across much of the curve, with longer maturities underperforming as the 10-year Treasury approached the 4.50% level. Munis did dip into negative territory for month as returns are now at -.37% with year-to-date returns totaling .59%.

Municipal bond ratios were relatively stable during the week despite rising yields in munis as ratios held firm this past week with the 10-year AAA muni-to-Treasury ratio finishing the week at 66.11%, while the 30-year ratio continues to remain the cheapest part of the curve with the ratio at 86.98%. We also saw that the 2-year and 5-year ratios ending the week in the 61-62% range.

Municipal Supply: The negotiated calendar for the week will have an expected volume of just over $10.4 billion with the largest deal of the week being the $919 million Triborough Bridge and Tunnel Authority General Revenue Bonds issuance which AmeriVet will be participating in the Selling-Group. The second largest deal of this week will be the $797 million Philadelphia School District GO issue, followed by the $781 million Great Lakes Water Authority. The Oklahoma City Public Property Authority plans on issuing $762 million of Arena Sales Tax Revenue Bonds.

Have a great week!