A fading Treasury rally wasn’t enough to dampen the firmer tone for municipal bonds Thursday afternoon as muni prices extended gains into another session, building off the stronger tone after Wednesday’s Fed announcement.

Throughout the trading session, traders said munis continued to climb higher. “Munis are in good shape,” an Ohio trader said, adding the market feels about five basis points stronger. “Coming in this morning we needed to play a little catch-up from the late afternoon bid that Treasuries caught yesterday and we’ve been able to hold firm at those levels even with Treasuries giving back a few basis points today.”

Yields on individual bonds on benchmark scales Thursday were lower, despite muni ETFs showing losses and more outflows from municipal bond funds, according to ICI.

On Wednesday, yields on the triple-A Municipal Market Data scale ended as much as seven basis points lower. The 10-year yield fell seven basis points to 2.67% and the 30-year yields fell four basis points to 4.29%. The two-year yield dropped three basis to 0.40% after trading flat at 0.43% for 44 straight session.

Yields on the Municipal Market Advisors scale ended as much as 10 basis points lower. The 10-year fell eight basis points to 2.83% and the 30-year yield fell five basis points to 4.37%. The two-year closed unchanged at 0.55% for the 24th session.

Treasuries were slightly weaker Thursday afternoon, paring some of the gains made Wednesday after the Fed meeting. The benchmark 10-year yield rose seven basis points to 2.75% and the 30-year yield increased five basis points to 3.80%. The two-year was steady at 0.33%.

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