NEW YORK — Municipal and Treasury yields collectively slept in Friday morning. But trading volume is up, thanks largely to leftovers from Thursday boosting the volume numbers, a trader in New York said.
“Trading volume is going to be higher than normal for a Friday because they’re ticketing the Florida turnpike deal,” he said, referring to Thursday’s competitive offering of $150.2 million of Florida Department of Transportation turnpike revenue bonds. “They’re just doing tickets on it. It’ll ramp it up.”
Tax-exempt yields started the day flat across the curve, according to the Municipal Market Data.
By Thursday’s end, the 10-year benchmark yield hovered at 2.63% for the sixth day in a row, the MMD scale showed. The 30-year yield ticked down one basis point to 4.23%, once again reaching its low since Nov. 12.
The two-year yield is holding — at 0.42% for the ninth consecutive day — at its lowest level since Sept. 7, according to MMD numbers. Before that, it stayed at 0.44% for 17 straight sessions.
Treasury yields also held steady across the curve Friday morning. The 10-year yield traded at 2.92%. The 30-year yield remained at 4.18%. The two-year yield stayed at 0.36%.
Lipper FMI reported net inflows of $137 million for muni bond funds that report their flows weekly during the week ended June 22. The previous week, investors withdrew $172 million from muni funds, not long after ending a 29-week trend of outflows.
For every week from mid-November to earlier this month, money had been flowing out of muni bond funds, commonly at weekly rates of more than $1 billion.
Some of this week’s inflow can be attributed to retail issues with the weak global economy and possible contagion from the Greek credit crisis, according to MMD analyst Daniel Berger.
“Additional reasons for positive inflows include the reduced perception of imminent widespread credit deterioration and the heavy seasonal reinvestments typically experienced during the months of June and July.”
