Municipals were steady to start the week, as U.S. Treasury yields edged higher out long and equities ended mixed.
The two-year muni-UST ratio Monday was at 62%, the five-year at 65%, the 10-year at 76% and the 30-year at 95%, according to Municipal Market Data's 3 p.m. ET read. ICE Data Services had the two-year at 62%, the five-year at 66%, the 10-year at 75% and the 30-year at 95% at a 4 p.m. read.
The municipal market saw a reprieve last week, as yields were firmer following the prior week's selloff.
With one week left in the month, munis continue to struggle with month-to-date losses at 0.65%, leaving year-to-date returns in the red at 0.99%, said Jason Wong, vice president of municipals at AmeriVet Securities.
"With just one week left in the month, this could be our first down July since 2013, in which we saw losses of 0.90%," he said.
Since the start of the year, the 10-year muni-UST ratio was at 68.09%; now it's at 76.02%, still down from April's highs of 88.14%, Wong said.
While munis are seeing negative returns and still underperforming USTs, investors should still "consider going out in the curve as it is still the cheapest part of the curve with ratios at 96.83% as we are starting to see munis at a discount on the long end, making it attractive among retail investors," he said.
"Oversupply" also contributed to munis' underperformance, as the potential elimination led many issuers to enter the markets early, Wong said.
The asset class got a "much-needed boost" from inflows into muni mutual funds last week, said Birch Creek strategists.
Investment-grade mutual funds saw a week-over-week reversal in fund flows, according to LSEG Lipper, which reported positive flows of $774 million into IG mutual funds as opposed to outflows of $259 million the week prior.
The majority of inflows into muni mutual funds went into exchange-traded funds.
"Ultra high-grade bonds around 5% and ratios greater than 100% of Treasuries proved to be attractive for both retail investors looking to lock in long-term tax-free income and crossover buyers who picked up spread relative to similarly rated taxable alternatives," Birch Creek strategists said.
There was an increase in bids wanteds with J.P. Morgan reporting an 18% rise, as well as a 17% increase in customer purchases, Birch Creek strategists said.
The largest transaction for last week, the New York City Transitional Finance Authority (Aa1/AAA/AAA/)'s $1.5 billion of future tax secured tax-exempt subordinate bonds, priced 29-year bonds with a 5% coupon at 5.07% when the 30-year UST was trading at 4.94%, per Birch Creek.
High-yield munis also saw a slight turnaround last week, as "benchmark names like Buckeye Tobacco" reported rallies, but with investors still "exercis[ing] restraint for below investment grade issuers" and a second consecutive week of outflows, caution remains abundant, they said.
One such example is a Florida deal of $203 million nonrated continuing care retirement community bonds that had put forward yields as high as 7.75% but was unable to get done, according to Birch Creek.
"It'll be interesting to see how things shake out [this week] given
In the primary market Monday, Siebert Williams Shank priced and repriced for the Georgetown Independent School District, Texas, (Aaa/AAA//) $334.005 million of PSF-insured unlimited tax school building and refunding bonds, with 5s of 2/2026 at 2.52%, 5s of 2030 at 2.75%, 5s of 2035 at 3.57%, 5s of 2040 at 4.31%, 5s of 2045 at 4.73%, 5.25s of 2050 at 4.87% and 5.25s of 2055 at 4.90%, callable 2/15/2035.
In the competitive market, the Waxahachie Independent School District, Texas, (Aa3/AA-//) sold $100 million of PSF-insured unlimited tax school building bonds to Wells Fargo, with 5s of 2/2026 at 2.59%, 5s of 2030 at 2.82%, 5s of 2035 at 3.57%, 5s of 2040 at 4.30%, 5s of 2045 at 4.77% and 5s of 2053 at par, callable 8/15/2035.
CUSIP requests rise
In June, the aggregate total of identifier requests for new municipal securities — including municipal bonds, long-term and short-term notes, and commercial paper — fell 1.2% versus May totals.
On a year-over-year basis, overall municipal volumes were up 16.8% through the end of June.
New York led state-level municipal request volume with a total of 233 new CUSIP requests in June, followed by Texas (151) and California (136).
For the specific category of municipal bonds, there was a drop of 9.8% month-over-month, but these requests are still up 19.6% on a year-over-year basis.
AAA scales
MMD's scale was unchanged: The one-year was at 2.43% and 2.43% in two years. The five-year was at 2.57%, the 10-year at 3.34% and the 30-year at 4.71% at 3 p.m.
The ICE AAA yield curve was little changed: 2.44% (unch) in 2026 and 2.41% (unch) in 2027. The five-year was at 2.59% (-2), the 10-year was at 3.29% (unch) and the 30-year was at 4.66% (unch) at 4 p.m.
The S&P Global Market Intelligence municipal curve was unchanged: The one-year was at 2.43% in 2025 and 2.44% in 2026. The five-year was at 2.57%, the 10-year was at 3.34% and the 30-year yield was at 4.71% at 4 p.m.
Bloomberg BVAL was unchanged: 2.40% in 2025 and 2.42% in 2026. The five-year at 2.54%, the 10-year at 3.31% and the 30-year at 4.71% at 4 p.m.
Treasuries saw small losses out long.
The two-year UST was yielding 3.927% (flat), the three-year was at 3.876% (+1), the five-year at 3.971% (+1), the 10-year at 4.413% (+2), the 20-year at 4.954% (+3) and the 30-year at 4.931% (+3) just before the close.
Primary to come
The Public Finance Authority (Baa3///BBB+) is set to price $3.5 billion of senior lien toll revenue bonds (
Orlando, Florida, is set to price Thursday $420.115 million of non-rated contract tourist development tax revenue bonds (Camping World Stadium), insured by Assured Guaranty. J.P. Morgan.
The Wisconsin Health and Educational Facilities Authority (/A+/A+/) is set to price Tuesday $414.035 million of revenue bonds (Hospital Sisters Credit Group), Series 2025A. Morgan Stanley.
Guam (Baa3///) is set to price Tuesday $268.99 million of business privilege tax refunding bonds, Series 2025G. Wells Fargo.
The Terrell Independent School District, Texas, (Aaa/AAA//) is set to price Wednesday $263.11 million of PSF-insured unlimited tax school building bonds. Piper Sandler.
The Dormitory Authority of the State of New York (Baa3/BBB//) is set to price Thursday $246.52 million of Mount Sinai Obligated Group revenue bonds. Jefferies.
The Comal Independent School District, Texas, is set to price $213 million of PSF-insured unlimited tax school building bonds. Mesirow Financial.
The Gregory-Portland Independent School District, Texas, (Aaa/AAA//) is set to price Tuesday $198.66 million of PPSF-insured unlimited tax school building bonds. Siebert Williams Shank.
The North East Independent School District, Texas, (Aaa//AAA/) is set to price Tuesday $191.665 million of PSF-insured unlimited tax refunding bonds. UMB Bank.
The Community Development Administration of the Maryland Department of Housing and Community Development (Aa1//AA+/) is set to price Tuesday $155 million of taxable residential revenue refunding social bonds, Series 2025F. Jefferies.
The Public Finance Authority is set to price Thursday $153.11 million of non-rated taxable revenue bonds (Prestwick Holdings LLC project). Morgan Stanley.
The Celina Independent School District, Texas, (Aaa/AAA//) is set to price Tuesday $130 million of PSF-insured unlimited tax school building bonds, Series 2025A. Piper Sandler.
The Vermont Bond Bank (Aa2/AA+//) is set to price Tuesday a $123.245 million deal, consisting of $73.995 million of Series 2 local investment bonds and $49.25 million of Series 3 refunding bonds. Morgan Stanley.
The Princeton Independent School District, Texas, (Aaa//AAA/) is set to price Tuesday $118.715 million of PSF-insured unlimited tax school building bonds. RBC Capital Markets.
Pearland, Texas. (/AA/AA+/) is set to price Monday $114.86 million of certificates of obligation, Series 2025B. Baird.
The New York State Housing Finance Agency (Aa2///) is set to price $108.6 million of sustainability affordable housing revenue bonds, consisting of $20.65 million of 2025 Series C-1 and $87.95 million of 2025 Series C-2. Ramirez.
Competitive
Washington (Aaa/AA+/AA+/) is set to sell $539.43 million of various purpose GOs, Series 2026A, Bid group 1 at 10:15 a.m. Eastern Thursday; $486.66 million of various purpose GOs, Series 2026A, Bid group 2 at 10:45 a.m.; $283.335 million of motor vehicle fuel tax and vehicle-related fees GOs, Series 2026B at 11:45 a.m.; and $152.835 million of taxable GOs, Series 2026T at 11:15 a.m., Eastern.
The Orangeburg County School District, South Carolina, is set to sell $190 million of general obligation bond anticipation notes at 11 a.m. Tuesday.
Pearland, Texas, is set to sell $114.86 million of certificates of obligation at 11 a.m. Tuesday.
