One day after the city of Chicago came to market, another Illinois issuer will be selling bonds ahead of the state's sale on Thursday.
Secondary Market
Treasuries were lower on Wednesday. The yield on the two-year Treasury rose to 0.93% from 0.91% on Tuesday, while the 10-year Treasury yield increased to 2.12% from 2.10% and the 30-year Treasury bond yield inched up to 2.89% from 2.88%.
Top-rated municipal bonds ended unchanged on Tuesday. The yield on the 10-year benchmark muni general obligation was unchanged from 1.78% on Monday, while the 30-year muni yield steady from 2.73%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Tuesday at 84.8% compared with 82.5% on Monday, while the 30-year muni to Treasury ratio stood at 94.8% versus 92.4%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 37,873 trades on Tuesday on volume of $6.60 billion.
Primary Market
On Wednesday, the Illinois Regional Transportation Authority will competitively sell $100 million of Series 2016A general obligation bonds.
The issue is rated Aa3 by Moody's Investors Service and AA by Standard & Poor's and Fitch Ratings.
The last time the RTA competitively sold comparable bonds was on Jan. 28, 2014, when Wells Fargo Securities won $99.30 million of Series 2014A GOs with a true interest cost of 4.38%.
The sale comes one day after Chicago sold $500 million general obligation refunding and restructuring bonds. While spreads were narrower than in the city's last sales in the spring and summer, Chicago still paid a high rate to borrow due to its ongoing pension woes and credit deterioration.
On Thursday, the state of Illinois will competitively sell $480 million of Series of 2016 GOs.
The bonds are rated Baa1 by Moody's Investors Service, A-minus by S&P and triple-B-plus by Fitch.
The last time the state competitively sold comparable bonds was on April 10, 2014, when Bank of America Merrill Lynch won $250 million of Series of April 2014 GOs with a TIC of 4.08%.
Since 2006, the state has sold about $27 billion of bonds, with the most issuance occurring in 2010 and 1012 when Illinois issued $8.68 billion and $5.11 billion, respectively. The state sold the least amount of debt in 2007 and 2008 when it issued $637 million and $125 million, respectively.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar fell $5.41 billion to $8.12 billion on Wednesday. The total is comprised of $5.04 billion competitive sales and $3.08 billion of negotiated deals.
