Updated

Updated · Bond Buyer · Jul 6

Muni Market Prepares for $9.48 Billion Issuance as July Reinvestment Flows Boost Demand

Updated

Updated · Bond Buyer · Jul 6

Muni Market Prepares for $9.48 Billion Issuance as July Reinvestment Flows Boost Demand

1 articles · Updated · Bond Buyer · Jul 6

$9.48 billion of municipal issuance is expected this week after the holiday-shortened lull, with investors turning quickly to new deals and cash reinvestment.
$8.03 billion of negotiated sales and about $1.45 billion of competitive deals should find support from heavy July maturities and coupon payments, though richer high-quality bonds could struggle in parts of the curve.
California State University anchors the negotiated calendar with $1.8 billion of revenue bonds, while the New York State Thruway Authority leads competitive sales with $566.67 million.
Around 100 basis points of taxable-equivalent yield pickup in investment-grade munis and 150 to 180 basis points in high yield are helping keep the asset class attractive versus other U.S. fixed income.
July demand is expected to stay firm in big markets such as New York and California, but strategists see reinvestment support fading after Labor Day and supply potentially pushing muni yields higher in September and October.