WASHINGTON — This year, the volume of municipal debt issuance is expected to increase from the suppressed levels in 2011 caused by curtailed federal spending, federal cuts to Medicaid and Medicare, and pent-up capital requirements and borrowing needs, according to a report Moody’s Investors Service released Monday.

“The backlog will translate into more issuance in some sectors, such as infrastructure and water and sewer utilities,” said Chris Holmes, public finance research director at Moody’s. “Higher education and other issuers will continue to hold back on capital expansion plans and associated borrowing.”

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