Municipal New Issuance: The negotiated calendar for this past week totaled to roughly $4.6 billion as we continue to see supply be limited with the largest deal being the $446 million Irvine California Facilities Financing Authority followed by the $411 million California State Public Works board issuance. AmeriVet was in one issue this past week which was the $25 million Maryland Department of Housing and Community Development as a Selling-Group-Member.

Municipal Secondary Trading: Trading for the week totaled to roughly $34.56 billion with 51% of trades being dealer buys. Secondary trading is expected to be down this week as we finally have a sizable new issue. According to Bloomberg, clients bids-wanted totaled to $6.25 billion for the week.

Municipal Spreads: For the sixth straight week, muni yields have fallen with yields on 10-year notes falling by 1.1 basis points to finish the week at 2.10%. With yields falling once again this week, we are continuing to see ratios lower with 10-year notes yielding 59.85% of Treasuries, compared to 62.24% a week ago, and 66.50% a month earlier. With yields falling more on the front end of the curve, the muni curve did steepen this past week by 2.9 basis points to 96 basis points.

According to Refinitiv Lipper US Fund Flows data, we are continuing to see outflows from muni bond funds as roughly $256 million was pulled from those funds from clients this past week. This follows prior week’s outflow of $92 million and the ninth consecutive week of outflows. We are slowly inching closer to negative territory for muni bond-funds as we are currently at $756 million of outflows for the year.

With the inflation number coming in lower than what was expected at 5% year-over-year, a sign in which that indicates that the Fed will start to ease after the summer as inflation is trending in the right direction. This has pushed yields even lower for the week with the yields falling by an average of 1.8 basis points. For the first two weeks of April, munis have gained roughly 1.03% giving us year to date returns of 3.83%. This has unfortunately caused the muni—Treasury ratio to fall even further to the lowest its been in nearly two years. 10-year munis are now yielding around 59.85% when compared to Treasuries, the lowest since June 21, 2021.

Municipal Supply: Supply for the week will pick up this week with an expected volume of just above $11 billion with the largest deal of the week being the $2.4 billion State of Illinois taxable issue. New Jersey Economic Development Authority is planning on selling $801 million in refunding bonds. AmeriVet will be in one issue this week as Selling-Group-Member which will be the $60 million Minnesota Housing Finance Agency social bonds issuance.