Primary bond market

The Beige Book suggests the economy is recovering, with optimism for 6-12 months ahead, while economists don't envision inflation rising enough for the Fed to take action any time soon.

Institutional pricing of New York City and competitive deals from Baltimore and Cambridge, Mass., should help give a sense of where yields are heading, while Ohio offers up GOs for a market that's been little changed for three days after a large sell-off.

The sell-off in the back half of February brought negative 1.59% returns for the month and a negative 0.96% return for the year so far. Taxables and high-yields fared slightly better.

The prominent private university will add $600 million to corporate CUSIP deal numbers that recorded a more than 200% increase last year.

The market took a much-needed breather Friday and U.S. Treasuries pared Thursday's losses to see the 10-year fall 12 basis points to 1.42% and the 30-year 17 basis points to 2.11%. Municipals were steady at 1.14% in 10 years and 1.82% in 30.

While issuance fell significantly from 2020, it was higher than January's and only the fifth time in 35 years that volume exceeded $30 billion in February.

Municipal bond mutual funds took notice of rate movements with Refinitiv Lipper reporting $37 million of inflows after 15 weeks of multi-billion inflows, the lowest since Dec. 2. High-yield funds took a big hit with $330 million of outflows.

BATA brings a refunding deal to market next week, buoyed by a financial position that stood up to the stresses of the COVID-19 pandemic.

The deal was the largest in the authority’s history, with the lowest ever interest rate for one of its sales and netting a record-breaking $112 million in interest cost savings.

Global bond yield move suggests financial markets are much more optimistic about the economy than the Fed.