Nearly all The Bond Buyer's weekly yield indexes declined during this holiday-shortened week.
Holiday doldrums coupled with a Sunday blizzard that buried much of the Northeast conspired to keep the secondary market very quiet.
"Munis had a degree of weakness in sympathy with Tuesday's Treasury losses and continued mutual fund selling," said Matthew Posner, director of Latin American operations at Municipal Market Advisors. "But the light secondary flow, that was the result of the storm on the East Coast and the holiday season mitigated losses."
Sunday's blizzard exacerbated what already figured to be a lightly traded session. Trading activity Monday was sparse and yields were flat.
The muni market was quiet and weaker by about one basis point Tuesday in sympathy with weakening Treasuries. Then, tax-exempt yields held flat Wednesday as Treasuries rebounded, erasing Tuesday's losses.
The Bond Buyer 20-bond index of 20-year general obligation bond yields declined five basis points this week to 4.95%. This is the lowest level for the index since Dec. 9, when it was 4.86%. The index's annual average for 2010 was 4.30%, the lowest for any year since 1967, when the annual average was 3.94%.
The 11-bond GO index of higher-grade 20-year GO yields dropped three basis points this week to 4.71%, which is its lowest level since Dec. 9, when it was 4.60%. The index averaged 4.03% for the year, which is the lowest annual average since 3.85% in 1967.
The revenue bond index, which measures 30-year revenue bond yields, decreased four basis points this week to 5.38%. This is its lowest level since Dec. 9, when it was 5.32%. The index's annual average for 2010 was 4.88%, which is the lowest since 2007, when it was a record low 4.64%. The index began in 1979.
The Bond Buyer one-year note index declined three basis points this week to 0.53%, which is its lowest level since Nov. 10, when it was 0.46%. The index averaged a record low 0.49% for 2010, breaking the previous record of 0.69% in 2009. The index began in 1989.
The yield on the 10-year Treasury note declined one basis point this week to 3.34%, which is its lowest level since Dec. 9, when it was 3.22%.
The yield on the 30-year Treasury bond fell four basis points this week to 4.41%, which is its lowest level since Dec. 9, when it was also 4.41%.
The weekly average yield to maturity on The Bond Buyer's 40-bond municipal bond index, which is based on 40 long-term municipal bond prices finished at 5.51%, up 1 basis point from last week's 5.50%.
