Municipal New Issuance: New Issues continued to slow as only approximately $1.6 billion come into the market as many issuers have put their deals on hold until market conditions improve.  Issuance has dropped dramatically from about $40 billion  February, to about only $18 billion in March, with most coming from the beginning of the month.

Municipal Secondary Trading: Trading last week was down, as we saw about $47 billion in secondary trades, compared to $129 billion the week prior. Investors offered about $8 billion for sale via bids-wanted, down about $10.3 billion from the previous period.  Trading was down mainly do to outflows from funds as we only saw about $749 million of outflows compared to $25.9 billion from the previous 2 weeks.

Municipal Spreads:  Markets took a quick reversal from the previous week as yields rose sharply, as investors continued to pull money out of the municipal markets.  Investors pulled $749 million from funds, marking its 5^th straight week of outflows, adding to the $25.9 billion pulled the last 2 weeks in March. Although we did have a nice rally on Friday, municipal yields are still up from its lows as the 10-year is 1.840 as compared to the previous week of 1.50.  Compare this number to where we were at over a month ago of .969.  Despite treasuries continuing to hit new highs, municipals are the contrarian as the 10-year ratio is now 278.05% compared to 206.48% a week prior. This has hit investors hard as they have been accustomed to municipals outperforming treasuries for the last few years.

Municipalities that are more sales-tax dependent should start to see more widening due to coronavirus continue to plague the nation.  The decline in sales-tax revenue is due to most people under quarantine or recently unemployed.  The one state that will see this impact is New York, as it saw the 3^rd most in job losses. According to Bloomberg    the average dependence on sales tax is 32% compared to 26% for property tax.  This will vastly affect whether or not these municipalities ability to pay their bond holders. As well as their credit ratings.

Municipal Supply: The calendar for first full week of April is showing about $3 billion in supply coming, this will all change as most issuers have put their deals as day to day.  Many Issuers currently are not willing to pay for the yields to raise money.  According to CUSIP Global Services we should continue to see new issue supply be small as municipal deals submitted by underwriters had decreased 49% from March from February.