Municipal Bond News
• NY and NJ deals will spur supply over the next 3 weeks, stay and local governments will be brining 9B to market this week alone. Higher yields should bring investors to the table this month, the volume of longer dated supply has dropped to 12% mostly due-to the elimination of Tax-exempt advanced refunding from the federal tax law changes at the end of 2017.
• Banks continue to reduce MUNI holdings as other securities have a better appeal. Many banks (JP Morgan, State Street, Wells, Citi, and BOA) reduced their holdings of MUNI’s by 16B for the first half of 2018. The bulk of this decline came in the 1st Q of this year. With this reduction, we have not seen any major decrease in pricing