Primary bond market

"We're going to be opportunistic based on what the market conditions are and what the interest rate environment is," said Ben Watkins, director of the Florida Division of Bond Finance. "We like to be like Boy Scouts — we always want to be prepared."

Fed Chair Jerome Powell said cuts are likely this year but are not guaranteed. He added that the Fed is looking for more signs that inflation is moderating. "We are prepared to maintain the current target range for the federal funds rate for longer if appropriate."

Issuance for the month is slightly above the $27.666 billion 10-year average, according to LSEG Refinitiv data.

"Yields are attractive, and there's going to be a lot of demand and there's not going to be a lot of bonds," said Scott Diamond, co-head of the municipal fixed income team at Goldman Sachs.

A private school catering to Los Angeles' wealthiest residents is tapping the municipal bond market to expand its campus and add to its academic offerings. 

"The market seems to be coalescing around the view that these historically rich ratios can be sustained through February, but that the market technical becomes far less favorable in March and April," said Birch Creek Capital strategists in a report.

The deal comes following several toll increases — which have bolstered the authority's credit — that have also compelled a state senator to introduce a bill that would dissolve the authority.

BofA expects muni yields to continue to move up and credit spreads to narrow "in a slow and gentle fashion" in February.

LSEG Lipper reported Thursday that investors added $210.6 million to municipal bond mutual funds for the week ending Wednesday — the third consecutive week — after inflows of $898 million the week prior.

As ridership remains low, investors are closely watching for new funding streams and credits like the MTA's planned congestion tax-backed bonds.