The primary municipal bond market saw a few deals trickle in on Wednesday, as the Federal Open Market Committee's announcement regarding interest rates nears.

The market expectation is the FOMC will hold the fed funds rate target range unchanged at 1.00% to 1.25%.

Primary market
President Trump is expected to make his nomination for Federal Reserve chair Thursday. Typically, not much action takes place on a day when the FOMC meets, but with no rate hike expected, some issuers are taking the plunge.

Bank of America Merrill Lynch priced the Mayor and City Council of Baltimore, Md.’s $226.955 million of general obligation consolidated public improvement and refunding and taxable bonds on Wednesday.

The $76.175 million of tax exempt series 2017A bonds were priced to yield from 1.06% with a 4% coupon in 2018 to 2.82% with a 5% coupon in 2037.

The $108.49 million of tax-exempt series 2017B bonds were priced to yield from 1.17% with a 5% coupon in 2019 to 2.57% with a 5% coupon in 2031.

The $33.675 million of taxable series 2017C bonds were priced at par to yield from 1.734% in 2018 to 3.659% in 2037. The 2018 maturity was priced about 30 basis points above the comparable Treasury and the 2037 maturity was priced about 130 basis points above the comparable Treasury.

The $8.61 million of taxable series 2017D bonds were priced at par to yield from 1.734% in 2018 to 1.958% in 2019. The 2018 maturity was priced about 30 basis points above the comparable Treasury and the 2019 maturity was priced about 35 basis points above the comparable Treasury.

The deal is rated Aa2 by Moody’s Investors Service and AA by S&P Global Ratings.

Wells Fargo priced the County of Guilford, N.C.’s $181.755 million of GO refunding bonds. The bonds were priced to yield from 0.99% with a 4% coupon in 2018 to 2.64% with a 3% coupon in 2030. It carries top ratings of triple-A from Moody’s, S&P and Fitch Ratings.

In the competitive arena, Massachusetts sold $142.64 million of federal highway grant anticipation notes for the Accelerated Bridge Program. Wells Fargo won the bidding with a true interest cost 2.15%. The GANs were priced to yield from 1.17% with a 5% coupon in 2021 to 1.98% with a 5% coupon in 2027. The deal is rated Aa2 by Moody’s and AAA by S&P.

Elsewhere, Williamson County, Tenn., sold a total of $125 million in two separate sales.

Morgan Stanley won $50 million of general obligation public improvement school bonds with a TIC of 2.75%.

Morgan Stanley also won the $75 million of county district school bonds with a TIC of 2.79%. Both deals are rated Aaa by Moody’s.

Also, Spokane School District No. 81, Wash., sold a total of $107.045 million of unlimited tax GO bonds in three separate sales.

JPMorgan won the $62.505 million deal with a TIC of 2.65%, PNC Capital Markets won the $27.32 million deal with a TIC of 3.36% and Bank of America Merrill Lynch won the $17.22 million deal with a TIC of 1.12%. The deals are backed by the Washington State School District Credit Enhancement Program and are rated Aa1 by Moody’s and AA-plus by S&P.

Secondary market
The yield on the 10-year benchmark muni general obligation was as many as one basis point higher from 2.01% on Tuesday, while the 30-year GO yield was as many as one basis point lower from 2.83%, according to a read of Municipal Market Data`s triple-A scale.

U.S. Treasuries were mostly stronger Wednesday around midday. The yield on the two-year Treasury nudged up to 1.61% from 1.59%, the 10-year Treasury yield was lower at 2.36% from 2.37% and yield on the 30-year Treasury bond was down to 2.84% from 2.87%.

On Tuesday, the 10-year muni-to-Treasury ratio was calculated at 84.6% compared with 84.8% on Monday, while the 30-year muni-to-Treasury ratio stood at 98.4% versus 98.2%, according to MMD.

AP-MBIS 10-year muni at 2.329%, 30-year at 2.885%
The Associated Press-MBIS municipal non-callable 5% GO benchmark scale was stronger on trading Wednesday around lunchtime.

The 10-year muni benchmark yield dropped to 2.329% from the final read of 2.335% on Tuesday, according to Municipal Bond Information Services, a national consortium of municipal interdealer brokers. The AP-MBIS 30-year benchmark muni yield was lower at 2.885% from 2.897%.

The AP-MBIS benchmark index is a yield curve built on market data aggregated from MBIS member firms and is updated hourly on the Bond Buyer Data Workstation.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 38,532 trades on Tuesday on volume of $10.713 billion.

Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar decreased $1.65 billion to $9.34 billion on Wednesday. The total is comprised of $4.32 billion of competitive sales and $5.02 billion of negotiated deals.

Data appearing in this article from Municipal Bond Information Services, including the AP-MBIS municipal bond index, is available on the Bond Buyer Data Workstation. Click here for a brief tour of the Workstation, or contact Vanessa Kim at 212-803-8474 for more information.

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Aaron Weitzman

Aaron Weitzman

Aaron Weitzman is a markets reporter for The Bond Buyer, focusing on the sell side of the municipal bond market.