Municipal New Issuance: The negotiated calendar for this past week totaled to roughly $8.8 billion for the week with the majority of the attention being given to the $2.3 billion State of Illinois GO issue. The Illinois deal received strong demand with majority of the demand in the long end with the 2047 maturity being 14 times oversubscribed which lowered yields by 10 basis points. AmeriVet was in one issue for the week which was the $60 million Minnesota Housing issue.

Municipal Secondary Trading: Trading for the week totaled to roughly $34.11 billion with 51% of trades being dealer sells. Secondary trading for the week was on the lighter side as the main focus was on the primary market. Client’s bids-wanted continues to be elevated for the week as selling pressure pushed yields higher for the week. According to Bloomberg, client’s put up about $6.3 billon out for the bid compared to $6.25 billion from the week prior.

Municipal Spreads: Muni yields rose for the first time in seven weeks last week with yields on 10-year notes rising by 24.3 basis points to end the week at 2.34%. With yields backing up this week, we did see ratios tick higher this past week with the 10-ratio now yielding 65.74% of Treasuries, compared to 59.78% a week earlier. Ratios are still rich out 15 years as investors are still continuing to favor tax-exempts in the front end. With yields rising this past week, the muni curve flattened by 9.2 basis points in the past week to 87 basis points.

Muni bond funds saw their largest outflows year-to-date as Refinitiv Lipper US Fund Flows reported that investors pulled about $2.87 billion out of muni bonds funds last week. Majority of the outflows were in long term muni funds with about $2.3 billion of outflows.

With the selloff in munis this past week we did see munis push into negative territory for the month with munis down by .34% for the month of April bringing year to date returns to 2.43%. Contributing factors to the sell off were heavier bids-wanted coupled with large outflows in muni bond funds which pushed yields higher by an average of 24.2 basis points across the curve last week. The rise in rates have sent ratios higher but the muni ratio to Treasuries is still rich out to 15 years. While the 10-year muni ratio three-year average is 84%, we are currently at 65.74%. If you take a look at the 5-year ratio, it is even richer at 63.57%

Municipal Supply: Negotiated supply for the week will dwindle to roughly $5.7 billion with the largest deals of the week being the $585 million Providence St. Joseph Health taxable issue, followed by the $500 million Illinois State Toll Highway Authority issue. AmeriVet will be in two issues for the week as a Selling-Group-Member which will be the $75 million Maryland Department of Housing and Community Development tax-exempt issuance and the $75 million Maryland Department of Housing and Community Development taxable issuance.