Markets

"The close to 50 bp adjustment to the front end of the AAA municipal curve, taken at face value, appears to be a huge step toward pricing normalization for tax-exempts," said Eric Kazatsky, head of municipal strategy at Bloomberg Intelligence.

A bill introduced by Sen. Dave Min would prohibit banks that invest in gunmaking from working on any aspect of state public finances, including bond sales.

Investors will be greeted Monday with a new-issue calendar estimated at $3.603 billion.

"As we spoke with our underwriting partners and our municipal advisors, given [market] volatility, we shortened that retail order period to one day," says OMB's David Womack.

Refinitiv Lipper reported $68.054 million was pulled from municipal bond mutual funds in the week that ended Wednesday after $775.006 million of inflows the week prior.

The economy was boosted by COVID and hurricane relief money, one economist says.

Inflows continued with the Investment Company Institute reporting investors added $2.194 billion to mutual funds in the week ending Feb. 8, after $1.471 billion of inflows the previous week.

Fitch Ratings received enough inquiries over S&P's action — slashing a Chicago suburb's GO rating by seven notches — that it put out a special commentary outlining differences between the two agencies' analytical approach even though Fitch does not rate the village under scrutiny.

"We urge you to use rescue plan money to make your community safer," Biden said. "Invest in affordable housing, get small businesses back on their feet, train your workforce." 

Rating analysts said dropping reserves to 0.25% from 5% to free up capacity does not impact the school bond guarantee program's triple-A ratings.