The supply and demand imbalance in the municipal market continues to push munis higher. Despite traders noting that activity and volume were weaker Tuesday after a three-day weekend, yields continued to hit new record lows.
Munis were much firmer Tuesday, according to the Municipal Market Data scale, even after setting new record-low yields every day last week. Yields inside the three-year were unchanged while the four-year and five-year yields fell two basis points. The six- to eight-year yields were unchanged while yields outside the nine-year fell between two and four basis points.