Municipal New Issuance: The third week of September negotiated calendar had roughly $7 billion in issuance an increase from $6.4 billion from the prior week. The largest deal of the week was the $1 billion New York City Transitional Finance Authority revenue bonds which AmeriVet was part of the syndicate group. The City of Houston Texas Airport Systems issued $ 660 million in taxable bonds. Brown University issued $565 million in bonds using a corporate cusip continuing the trend of colleges and universities using corporate cusips to issue bonds.

Municipal Secondary Trading: Secondary trading for the week totaled around $28.5 billion according to MSRB down from the week prior of $33 billion. There was a slight increase in bids-wanted to $2.6 billion from customers, which was up from the week prior or $2.18 billion.

Municipal Spreads: Municipal bond yields fell slightly all across the curve this week as 10-year notes fell by only 0.5 basis points to 0.816%. With yields falling last week, the gap between yields on short-term and long-term bonds remained unchanged at 148 basis points. The 10-year ratios did improve this week to 117.41% of treasuries compared to 123.08% the week prior, but still are lagging compared to 98.65% a month ago.

For the 19^th straight week municipal bond funds saw inflows as they added $612 million according to Refinitiv Lipper US Funds Flow Data. Long-term saw about $64 million of inflows with intermediate funds seeing about $116 million of inflows, and high-yield funds adding about $61 million.

With many investors continuing to seek yield many have been moving more into higher yielding municipal bonds as they offer more yield than taxable high yield corporate bonds. Before making the adjustment corporate high-yield bonds would provide more than 100 basis points of more yield than municipal high-yield bonds. If you use 35% tax-bracket high yield municipal bonds offer 56 basis points more in yield compared to the same duration high=-yield corporate bonds.

Municipal Supply: Supply for the week will be up from a week ago as there will be roughly $10.5 billion in negotiated issuance. The largest of the deals will be the $1.24 billion City of Chicago, Chicago O’Hare International Airport taxable and tax-exempt issue followed by a $923.5 million New York City Industrial Development Agency Yankee Stadium Project. AmeriVet will be part of three deals this week the $532 million New York City Municipal Finance Authority, the $161 million New York State Housing Finance agency and the $110 million Florida Housing Finance Corporation Revenue bonds.