Dan Seymour

The supply drought that has prevented the municipal yield curve from steepening further is a drought better measured in years than in dollars.

The municipal bond market has slipped into a disquieting equilibrium in which investors don’t really want to buy munis and municipalities don’t really want to sell them.

Assured Guaranty Ltd. announced today that chief operating officer Séan W. McCarthy will be leaving the company at the end of the month to “pursue other opportunities.”

The municipal bond market has slipped into a disquieting equilibrium in which investors don’t really want to buy municipal bonds and municipalities don’t really want to sell them.

Cash withdrawals from municipal bond mutual funds accelerated last week, proving that commitment from the retail community remains fragile even when muni bonds are doing ­better.

Municipal bonds have notched a good week as governments’ willingness to refrain from borrowing means investors with money to spend mostly have to chase existing bonds in the secondary market.

MBIA Inc. still expects to pay more claims as the credit quality of the debt it insures erodes, even for some policies in its public finance book.

Some banks are taking a detour around the complicated and expensive process of guaranteeing a municipal government’s bonds by just buying the bonds themselves.

According to survey results released Wednesday, when RBC Capital Markets asked 100 state and local government experts at The Bond Buyer Texas Public Finance Conference last month whether they would buy municipal bonds for their own portfolios, all 100 said yes.

The municipal bond market remained comatose in February, with state and local governments reluctant to try and raise money in the face of unreliable demand and volatile borrowing costs.

The pressure on municipal bond mutual funds is fading rapidly as a much less panicked tone in the state and local government debt market has stemmed the exodus of cash from the industry.

The tide of cash washing out of municipal bond mutual funds continued to ebb last week as more and more of the “hot money” that flooded the industry the last two years seems to have escaped by now.

Statistics on letter-of-credit issuance to municipalities last year indicate the municipal credit market is in dire trouble. But the statistics only tell part of the story.

The Obama administration’s proposal to renew the Build America Bond program may suffer from the same problem it had the first time around, when the federal government didn’t think municipalities would use BABs that much.

Low short-term interest rates continue to erode the investment income of state and local governments.

As the expiration of the Build America Bond program loomed last year, the market was wracked with uncertainty about just who was going to buy long-term tax-exempt bonds. Thanks to the drought of new municipal bond issuance in 2011, the market is still wondering.

Carl Dincesen, the former head of ­municipal credit at Ambac, plans to launch an investor-pays credit ratings service later this month to fill what he describes as a niche: a forward-looking evaluation of the probability a municipality will default.

Municipal bond mutual fund outflows continued to subside last week from recent record-setting levels as the cash most prone to panic appears to have left by now.

Gridlex, a risk-management and trade analytics service, announced the launch Tuesday of a service evaluating the illiquidity of municipal bond mutual fund holdings.

Long-term municipal bonds weakened on Wednesday due to renewed jitters about the scarcity of buyers for long-duration tax-exempt bonds.