New York City Transitional Finance Authority

The New York City Transitional Finance Authority plans to make an impact on the municipal market this month with $1.8 billion of bond sales.

The NYC TFA will test how the national news cycle has affected the market's appetites. 

New York boasts four of the top 10 issuers, followed by California with two and one a piece for Florida, Massachusetts, Washington and New Jersey.

With investors now anticipating Wednesday's expected rate cut may be the last one for a while, "an overall bullish paradigm has been seriously weakened," noted Matt Fabian, a partner at Municipal Market Analytics, Inc.

Supply falls ahead of the final Federal Open Market Committee meeting of 2024 and the holidays but issuance still breaks records. The lighter calendar should provide support for the secondary market in the final weeks of the year.

The New York City Transitional Finance Authority is set up to refund Build America Bonds as part of a $2.11 billion deal slated to land in the market this week.

The CPI print keeps the possibility of the Fed cutting rates at least once this year, potentially at least two rate cuts if the data continues to point to a trend of inflation falling further, said Jeff Lipton, a research analyst and market strategist.

This week's issuance is above the 2024's year-to-date weekly average of $7.6 billion, said Chris Brigati, senior vice president and director of strategic planning and fixed income research at SWBC.

The city and its related issuers picked financial advisors to work on upcoming bond deals, including GO issuances, TFA deals and water authority sales.

The bonds are rated Aa2 by Moody's Investors Service, AA by S&P Global Ratings and Fitch Ratings and AA-plus by Kroll Bond Rating Agency. All four rating agencies have a stable outlook on the credit.