The Bond Buyer's 2026 Predictions Report
The Bond Buyer Predictions 2026 survey was fielded online during November and December, with responses from 74 municipal finance professionals. Respondents represent a range of organization types, with the largest shares from broker-dealers (27%), issuers (18%), municipal advisors (16%), and law firms (8%).
Top findings from the report- Tariff volatility is a virtual certainty in 2026.
- Political uncertainty is the greatest threat to municipal finance over the next five years.
Results from the report are highlighted below using interactive charts. Mouse over each section for more detail, click on the chart labels to show or hide sections and use the arrows to cycle between chart views.
This item is the start of a series diving into new research from The Bond Buyer. Click the links below to read the other parts of the overall research.
- Part one: Muni growth predicted despite Fed shakeup
- Part three: Coming soon
- Part four: Coming soon
- Part five: Coming soon
How will tariffs and loosening regulations affect munis in 2026?
Key takeaway: Tariff volatility is pretty much certain in 2026.
The bond markets whipsawed in the face of Trump's tariff announcements throughout 2025. However, experts say they're better prepared than before for any new tariff announcements.
Following the Supreme Court's 6-3 vote last week to
"Trump indicated the administration will implement additional tariffs under different authorities and we expect the aggregate effective tariff rate to ultimately settle around 13%, largely unchanged from current levels," Nuveen strategists said.
Markets have been relatively muted following the announcement. Craig Brandon, co-head of muni investments at Morgan Stanley Investment Management, told The Bond Buyer: "It doesn't feel like the impact from Liberation Day last year yet [as] I think we've become a little bit numb to all of the news that comes out every day."
Tariff volatility was a major worry for municipal finance leaders in 2025, to the point that 89% predict this trend will continue in 2026 versus 11% who felt that it probably wouldn't come to pass. Loosening of the U.S. regulatory atmosphere was another high possibility for this year, with 83% saying it will happen versus 17% who say it won't.
Both trends would bring sizable risk to the industry should they come to pass. Roughly 48% of respondents said tariff volatility would pose a moderate to significant risk, while 27% said the same for loosening regulations. Interestingly, only 8% said tariff shakeups wouldn't pose any risk while 41% said the same for regulatory easing.
A similar distribution of experts was seen when asked how tariff and regulation moves would specifically pose a risk to their businesses. For tariffs, 41% said significant to great risk, 39% said a little risk, 18% said no risk and 1% were unsure.
For loosening regulations, 19% said significant to great risk, 30% said a little risk, 50% said no risk and 1% were unsure.
The top threats facing municipal finance over the next five years
Key takeaway: Political uncertainty is the greatest threat to municipal finance over the next five years.
The municipal finance industry is on the precipice of massive change, as the Trump administration continues to release new public finance proposals and the Federal Reserve is due for a new chair in May. Changes like these are but a few of the major worries facing municipal finance professionals this year.
Political uncertainty was the top-ranked threat to the muni industry, with 82% of respondents in agreement. Other threats close behind include legislative action (55%), cyberattacks (43%) and credit quality deterioration (38%).
Regulation-specific trends worth noting featured regulatory changes including disclosure and transparency (32%) and monetary policy actions (28%).
Political uncertainty has a
The material impact of political uncertainty can be seen in the Gateway Development Commission, which is masterminding a $16 billion project to add to and replace parts of 100-year-old tunnels under the Hudson River. Funding was
Kris Kolluri, current president of NJ Transit and former CEO of the commission, said during a panel at The Bond Buyer's National Outlook Conference earlier this month that stalling the project could create devastating results.
"Anything we do to destabilize this project, take it off the books, as it were, one day will lead to a catastrophic failure of those tunnels," Kolluri said. "Mark my words."
