Markets were quiet Friday as both muni and U.S. Treasury yields were little changed, while equities ended up.
Over the past week, rates have sold off around 10 basis points as "risk premia related to the U.S.-China tariff war have been partially unwound," said Barclays strategists Mikhail Foux and Grace Cen.
Nevertheless, the muni market has done "rather well" in the face of this selloff, despite robust supply and MMD-UST ratios falling one to two percentage points across the curve, they said.
The two-year ratio Friday was at 71%, the five-year at 71%, the 10-year at 74% and the 30-year at 90%, according to Municipal Market Data's 3 p.m. ET read. ICE Data Services had the two-year at 71%, the five-year at 71%, the 10-year at 73% and the 30-year at 89% at 4 p.m.
Elsewhere, heavy supply has been a widely discussed topic this year, Barclays strategists said.
Issuance is up 15% year-to-date, according to LSEG, and the Bond Buyer 30-day visible supply is at one of the highest levels in recent history.
However, the first half of the year may not tell the whole story, Barclays strategists noted.
Supply is usually "backloaded," like in 2024 when issuers came to the muni market en masse during June through July to get ahead of post-election volatility. This resulted in 2024 being the highest total supply figure on record, they said.
"2025 might be different, as issuers are trying to bring their deals prior to the tax reform, which, thus far, has not brought any unpleasant surprises for our asset class," Barclays strategists said. "In that case, issuance in 2H25 might not be overwhelming, as some municipalities might be patient, possibly waiting for lower rates down the line."
During the second half of last year, issuance was up 12%, and this year "it might be at the same level as ... 1H25," they said.
Based on data from the first four months of the year, issuance in most muni sectors should fall year-over-year, Barclays strategists said.
Education, though, is set to exceed 2024's figures by 25%, and higher ed is on tap to rise 50% year-over-year, they said.
New-issue calendar
Issuance for the week of May 19 is estimated at $11.667 billion, with $8.72 billion of negotiated deals and $2.947 billion of competitive deals on tap.
The Kansas Department of Transportation (Aa2/AA//) leads the negotiated calendar with $730.765 million highway revenue and refunding bonds, followed by the New Jersey Educational Facilities Authority with $705.045 million Princeton University revenue bonds.
The competitive calendar is led by Loudoun County, Virginia, with $208.08 million GO public improvement bonds.
AAA scales
MMD's scale was bumped up to two basis points. The one-year was at 2.83% (-2) and 2.84% (-2) in two years. The five-year was at 2.90% (-2), the 10-year at 3.27% (-2) and the 30-year at 4.43% (unch) at 3 p.m.
The ICE AAA yield curve was bumped up to two basis points: 2.85% (-1) in 2026 and 2.82% (-1) in 2027. The five-year was at 2.92% (-2), the 10-year was at 3.26% (-1) and the 30-year was at 4.40% (unch) at 4 p.m.
The S&P Global Market Intelligence municipal curve was bumped up to two basis points: The one-year was at 2.83% (-2) in 2025 and 2.84% (-2) in 2026. The five-year was at 2.91% (-2), the 10-year was at 3.29% (-2) and the 30-year yield was at 4.42% (unch) at 4 p.m.
Bloomberg BVAL was bumped two basis points: 2.81% (-2) in 2025 and 2.87% (-2) in 2026. The five-year at 2.97% (-2), the 10-year at 3.29% (-2) and the 30-year at 4.40% (-2) at 4 p.m.
Treasury yields were little changed.
The two-year UST was yielding 3.99% (+3), the three-year was at 3.967% (+2), the five-year at 4.065% (+1), the 10-year at 4.436% (flat), the 20-year at 4.919% (flat) and the 30-year at 4.891% (flat) at the close.
Primary to come
The Kansas Department of Transportation (Aa2/AA//) is set to price Wednesday $730.765 million highway revenue and refunding bonds, Series 2025A, serials 2026-2044. J.P. Morgan.
The New Jersey Educational Facilities Authority (Aaa/AAA//) is set to price Tuesday $705.045 million Princeton University revenue bonds, consisting of $593.76 million of Series 2025A and $111.285 million of Series 2025B, Morgan Stanley.
The Washington Health Care Facilities Authority (/A/A+/) is set to price Wednesday $641.17 million Multicare Health System revenue bonds, consisting of $423.07 million of Series 2025A fixed rate bonds, serials 2026-2045, term 2051; $109.595 million of Series 2025B put bonds, serial 2055; and $108.505 million of Series 2025C put bonds, serial 2055. BofA Securities.
The Leander Independent School District, Texas, is set to price Tuesday $520.363 million PSF-insured unlimited tax school building and refunding bonds, consisting of $481.372 million of Series 2025A (/AAA/AAA/), serials 2026-2045, terms 2050, 2055, and $38.991 million of Series 2025B (/AA/AA+/), serials 2026-2034. J.P. Morgan.
Boston (Aaa/AAA//) is set to price Wednesday $460.825 million of Series A GOs, serials 2026-2045. Raymond James.
The Aurora Public Schools, Colorado, (Aa2/AA//) is set to price Tuesday $450 million Colorado State Intercept Program -insured GOs, serials 2025-2026, 2033-2047. Stifel.
Charlotte, North Carolina, is set to price Wednesday (Aa3//AA-/) $307 million airport revenue bonds, consisting of $281.875 million of non-AMT bonds, Series 2025A, serials 2026-2045, terms 2050, 2055, and $25.125 million of AMT bonds, Series 2025B, serials 2027-2044. BofA Securities.
Williamson County, Texas, (/AAA/AAA/) is set to price Wednesday a $304.41 million deal, consisting of $146.29 million unlimited tax road bonds, serials 2026-2045; $67.15 million limited tax refunding and park bonds, serials 2026-2045; and $90.97 million limited tax notes, serials 2026-2032. Raymond James.
Fort Bend County, Texas, (A2/AA/A+/) is set to price Wednesday $271.18 million Assured Guaranty-insured senior lien toll road revenue and refunding bonds, serials 2026-2045, terms 2050, 2055. Cabrera Capital Markets.
Polk County, Iowa, (Aaa/AAA//) is set to price Wednesday $237.83 million GO capital loan notes, consisting of $169.65 million of Series 2025A, serials 2027-2045, and $68.18 million of Series 2025B, serials 2027-2045. J.P. Morgan.
The North Carolina Housing Finance Agency (Aa1/AA+//) is set to price Tuesday $206.555 million taxable home ownership revenue bonds, Series 58-B, serials 2026-2037, terms 2040, 2045, 2050, 2056. RBC Capital Markets.
The College Station Independent School District, Texas, (Aaa///) is set to price Tuesday $192.165 million unlimited tax school building and refunding bonds, serials 2026-2050. Jefferies.
The Maryland Department of Housing and Community Development (Aa1//AA+/) is set to price Tuesday $155 million taxable social residential revenue bonds, 2025 Series D, serials 2026-2037, terms 2040, 2045, 2051, 2055. BofA Securities.
The Virgin Islands Transportation and Infrastructure Corp. (/A//) is set to price Tuesday $151.25 million grant anticipation revenue bonds, serials 2025-2044. Ramirez.
Tempe, Arizona, (/AAA/AAA/) is set to price Tuesday $148.585 million GOs and GO refunding bonds, serials 2026-2045. RBC Capital Markets.
The Rhode Island Health And Educational Building Corp. (/BB-//) is set to price Thursday $143.285 million CharterCARE Health of Rhode Island Obligated Group hospital financing revenue bonds, consisting of $87.05 million Series 2025A tax-exempts, terms 2040, 2045, 2050, 2055, and $56.235 million Series 2025B taxable, serial 2035. Barclays.
New Braunfels, Texas, (Aa1///) is set to price Wednesday $134.24 million utility system revenue refunding bonds, serials 2025-2056. Piper Sandler.
The Florida Housing Finance Corp. is set to price Wednesday $130 million non-AMT homeowner mortgage revenue bonds, 2025 Series 3, serials 2027-2037, terms 2040, 2045, 2050, 2056, 2056. RBC Capital Markets.
The Gardner Edgerton School District No. 231, Kansas, (/AA-//) is set to price Monday $127.235 million GO refunding and improvement bonds, serials 2027-2045, terms 2047, 2050. Piper Sandler.
The Ernest N. Morial New Orleans Exhibition Hall Authority (Aa3//AA+/) is set to price $125 million special tax revenue bonds. Morgan Stanley.
The Southwestern Illinois Development Authority (/AA//) is set to price Monday $116.315 million BAM-insured Triad Community Unit School District #2 Project local government program revenue bonds, consisting of $13.785 million of Series A, serials 2030-2036, and $102.53 million of Series B, serials 2036-2050. Stifel.
Lakeland, Florida, (Aa2//AA+/) is set to price $112.355 million capital improvement revenue and revenue refunding bonds, consisting of $74.47 million Series 2025A non-AMT refunding bonds, serials 2025-2045; $12.735 million Series 2025B AMT refunding bonds, serials 2026-2045; $25.15 million Series 2025C taxables, serials 2026-2045. Wells Fargo.
The Osceola County School District, Florida, (Aa2/NR/AA/) is set to price Tuesday $109.315 million capital outlay sales tax revenue bonds, serials 2026-2036. Raymond James.
Competitive
Loudoun County, Virginia, is set to sell $208.08 million GO public improvement bonds, Series 2025A, at 10:30 a.m. eastern Tuesday.
The North Texas Municipal Water District is set to sell $204.175 million Panther Creek Regional Wastewater System contract revenue bonds at 11 a.m. Thursday.
The South Dakota Conservancy District is set to sell $198.24 million SRF program bonds, Series 2025A, at 11:15 a.m. Wednesday.
Montgomery County, Pennsylvania, is set to sell $148.855 million GOs at 10:30 a.m. Wednesday.
Chattanooga, Tennessee, is set to sell $146.935 million electric system refunding revenue bonds at 10 a.m. Wednesday.
The Salt Lake City School District Board of Education, Utah, is set to sell $140.95 million GOs at 11:30 a.m. Wednesday.
Scottsdale, Arizona, is set to sell $107 million Project of 2019 GOs at 10 a.m. Tuesday.
The Fayette County Board of Education, Kentucky, is set to sell $106.185 million GO refunding bonds at 11 a.m. Tuesday.
The North Kansas City School District No. 74, Missouri, is set to sell $100 million GO improvement bonds at 11:30 a.m. Tuesday.
