Buy side

Issuers routinely refund 5% bonds in year 10, and the resulting savings can be significant. It is notable that although refunding is typically associated with declining interest rates, 5% bonds are refunded even if rates rise.

The "risk to the tax exemption appears to have dropped sharply as of last week ... taking with it the hypothetical risk of a supply surge ahead of any end-date for borrowers' exemption access," said Matt Fabian, a partner at Municipal Market Analytics.

Chicago is "diligently preparing" to sell debt, now that the bond market has mostly recovered from April's turmoil, Chief Financial Officer Jill Jaworski said.

At a Bond Buyer conference in Atlanta, industry leaders talked about tariff turmoil, the tax-exemption, weather resiliency, infrastructure and more. 

A couple of "bond-friendly" economic reports released Thursday could encourage the Federal Reserve to reduce interest rates in the near future, some analysts argued.

For most investors, partnership matters, said Jamie Doffermyre, head of public finance syndicate and origination at Truist Securities.

While April was a challenging month for muni performance, this summer will be a more supportive environment, said Mark Paris, chief investment officer and head of municipals at Invesco.

Chicago will host its annual investor conference on Thursday as Mayor Brandon Johnson's administration faces challenges including a $1.12 billion deficit.

Even with Monday's U.S.-China tariff truce and Tuesday's inflation print, the market has felt better over the past several weeks, said Jamie Iselin, managing director and head of municipal fixed income at Neuberger Berman.

Munis yields followed UST yields higher Monday, rising one to four basis points, depending on the scale, but the asset class outperformed USTs.