Markets

With the advance refunding of tax-exempt munis still off the table, issuers are using existing market conditions to shed Build America Bonds and realize debt service savings through tender offers.

North Carolina's triple-A ratings were affirmed ahead of plans to sell up to $506 million in general obligation and limited obligation bonds.

The tax-exempt market is expected to be "biased higher" in the coming weeks and months as the expected heavy pace of issuance this month will not be as "oppressive" as feared, said Pat Luby, head of municipal strategy at CreditSights.

"I've never seen this level of hand wringing at the issuer level," said Matt Boles, managing director at RBC Capital Markets.

The first part of exclusive research from The Bond Buyer finds that most industry optimists say funding needs will be met sometime after 2035.

Demand may strengthen as "investors anticipate the Federal Reserve's likely path of rate cuts, which would drive yields even lower," said Tom Kozlik, managing director and head of public policy and municipal strategy at HilltopSecurities.

The bonds are rated A-plus by three ratings agencies and are expected to have serial maturities from 2026 to 2055.

"The story remains the same: solid demand is more than enough to take down the sizable new issue supply," said Daryl Clements, a portfolio manager at AllianceBernstein.

Its triple-A bonds have recovered after cheapening earlier this year under a pressure campaign from the Trump administration.

The Dormitory Authority of the State of New York and New York City both saw billion-dollar-plus deals oversubscribed.