Markets

It's been another strong week for municipal bonds as yields fell and investors gobbled up new issuance. Demand in the primary propelled the market as major deals saw yields lowered around five basis points, on average. In some cases, issues were accelerated to market or upsized.

In the first quarter of 2012, Moody's Investors Service downgraded the second highest quarterly total of municipal debt in the last 10 years.

While individual investors — the primary owners of municipal debt — have generally increased their holdings in the last 10 years, some institutional investors have trimmed their holdings and others have been aggressive buyers.

Municipal bond volume should hold steady this week, buttressed by a $1.8 billion Illinois deal that has the industry's attention.

Investors piled into muni bond mutual funds this past week.

It was a quiet week for an otherwise indecisive municipal market.

Hefty outflows from tax-exempt money market funds continued for the second week, as $3.77 billion bled out and total net assets sank to $276.92 billion in the week ended April 23, according to the Money Fund Report, a service of iMoneyNet.com.

After two quarters of decline, public finance credit stabilized in the first quarter of 2012, Standard & Poor's reported.