The municipal bond market headed lower for the third straight week as yields rose on new supply flooding the market, a 26th consecutive outflow from bond funds, and a softer Treasury market.

Several large deals priced this week, including $1.78 billion of Jefferson County, Ala., sewer bonds and $1.5 billion of Port Authority of New York and New Jersey bonds, which pushed the market lower on soft demand. Outflows from municipal bond mutual funds totaled $770 million to extend weekly redemptions to half a year, according to Lipper FMI. Muni yields followed Treasury yields higher after the Federal Open Market Committee meeting minutes released on Wednesday showed the Fed may taper its $85 billion-a-month bond purchasing program in the coming months.

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