The municipal bond market cleared the decks as it awaited the afternoon’s decision by the Federal Reserve on whether to raise interest rates. There are no major sales slated for pricing on Thursday or Friday.
The Federal Open Market Committee winds up its two-day meeting and will release its decision statement Thursday afternoon, followed by a press conference with Fed Chair Janet Yellen.
Secondary Trading
Treasury prices were little changed on Thursday, with the yield on the two-year Treasury note flat from 0.80% on Tuesday, while the 10-year yield slipped to 2.28% from 2.29% and the 30-year yield decreased to 3.07% from 3.08%.
The yield on the 10-year benchmark muni general obligation ended one basis point stronger at 2.26% from 2.25% on Tuesday, while the yield on the 30-year GO was one basis point stronger at 3.25% from 3.24%, according to the final read of Municipal Market Data's triple-A scale.
The 10-year muni to Treasury ratio was calculated on Wednesday at 98.1% versus 102.3% on Tuesday, while the 30-year muni to Treasury ratio stood at 105.1% compared to 106.0%, according to MMD.
Tax-Exempt Money Market Funds Saw Outflows
Tax-exempt money market funds experienced outflows of $1.87 billion, bringing total net assets to $247.05 billion in the period ended Sept. 14, according to The Money Fund Report, a service of iMoneyNet.com. This followed an inflow of $2.23 billion to $248.92 billion in the previous week.
The average, seven-day simple yield for the 377 weekly reporting tax-exempt funds remained at 0.01% for the 124th straight week.
The total net assets of the 949 weekly reporting taxable money funds fell $3.96 billion to $2.423 trillion in the period ended Sept. 15, after experiencing an outflow of $13.42 billion to $2.427 trillion the previous week.
The average, seven-day simple yield for the taxable money funds remained at 0.02% for the 35th week in a row.
Overall, the combined total net assets of the 1,326 weekly reporting money funds decreased $5.83 billion to $2.670 trillion in the period ended Sept. 15, which followed an outflow of $11.19 billion to $2.675 trillion the week before.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 39,234 trades on Wednesday on volume of $7.577 billion.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar fell $2.48 billion to $6.47 billion on Thursday. The total is comprised of $2.81 billion competitive sales and $3.65 billion of negotiated deals.
