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AmeriVet Weekly Muni Snapshot

Municipal New Issuance: Last week’s negotiated supply totaled to roughly $6.6 billion for the week with the largest deals being the $949 million Denton Independent School District issuance which garnered the most attention this past week. The next largest deal of the week was the $767 million Intermountain Power Agency issue. AmeriVet was in one issue this week which was the $26 million Maryland Department of Housing and Community Development as a Selling-Group-Member.

Municipal Secondary Trading: Trading for the week totaled to just under $36 billion with 53% of trades being dealer sells. With many expecting just one more rate hike for the year, we should expect to see more investors jump back into tax-exempts. According to Bloomberg, clients put up $4.68 billion up for the bid this past week with 2 days having bids-wanted of over $1 billion.

Municipal Spreads: Muni yields for the second week of July fell across the curve with 10-year notes falling by 6.5 basis points to end the week at 2.55%. Even though yields fell this past week, the muni-to-Treasury ratio is trending higher with the 10-year ratio now yielding 66.67% compared to 64.30% from the prior week. We did see the yield curve steepen this past week by 1.1 basis points to finish the week off at 67 basis points.

According to Refinitiv Lipper US Fund Flows data, this past week, investors pulled roughly $136 million from muni bond funds. This follows the prior weeks outflow of $856 million. On a positive note, we did see long-term funds post inflows of about $38 million.

Munis ended the week firmer as the markets are indicating that one more rate hike is likely as the Consumer Price Index (CPI) report, as well as other positive economic data showed that inflation has cooled bringing muni yields down further. As we head to the midway point of July, munis are up slightly for the month returning just .16%, bringing the year-to-date returns to 2.84%. Last year, munis were down 7.68% for the year. With July being usually a positive month for munis, coupled with the positive economic data, we should expect to see munis trend higher.

Municipal Supply: The negotiated calendar for this week will have an expected volume of roughly $8.78 billion with the largest deal being the $950 million New York City Transitional Finance Authority issuance which AmeriVet will be participating as a Selling-Group-Member. AmeriVet will be a Co-Manager on the $906 million California State University issuance which will include taxable and tax-exempt bonds. AmeriVet will also be in two other issues this week as a Selling-Group-Member which will be the $300 million Maryland Department of Housing and Community Development and the $45 million New Hampshire Housing Finance Authority issuances.