Primary bond market

First thing this morning, there wasn't much action as market participants waited to see what would happen, but as the day went on, munis got progressively weaker, said Kyle Gerberding, director of trading, a portfolio manager and partner at Asset Preservation Advisors.

Issuance was $40.336 billion in 632 issues, down only 1.1% year-over-year from $40.772 billion across 731 transactions.

The Vermont Bond Bank debuts a new indenture when it sells $56 million of bonds this week. It's following a nationwide trend in bond bank structures. 

On the week, the muni market performed well, with most investor action happening in the longer half of the curve, said BofA strategists.

Investors added $1.029 billion to municipal bond mutual funds in the week ended Wednesday, following $1.269 billion of inflows the prior week, according to LSEG Lipper data. This is the seventh time in eight weeks that inflows have topped $1 billion.

Findings from The Bond Buyer's 2026 Predictions Report show tax shakeups and political uncertainty pose major challenges to public finance.

There is a positive view of the muni market in the long-term due to a mix of attractive tax-adjusted yields and a generally favorable credit backdrop, said Cooper Howard, director of fixed income research and strategy at Charles Schwab.

The Trump administration filed the lawsuit Tuesday ahead of UC Regents plans to price $1.93 billion in revenue bonds.

While broader economic risks remain, market dynamics are being driven by supply, demand and income generation, rather than macro headlines, said Pat Haskell, head of the municipal bond group at BlackRock.

"Trump indicated the administration will implement additional tariffs under different authorities, and we expect the aggregate effective tariff rate to ultimately settle around 13%, largely unchanged from current levels," Nuveen strategists said.

Jeff Lipton compares The Bond Buyer's 2026 Predictions Report to his outlook series.

The Bond Buyer's 2026 Predictions Report shows professionals expect growth for the year ahead, but are cautious about changes coming to the central bank.

Bond markets believed Trump would likely keep tariffs in place in some form — even before the president made his announcement later in the afternoon — which partly explains their muted response throughout the day.

The commission also approved developing a plan to refund $286 million of bonds.

Money is flowing into mutual funds and buyers are snapping up deals.

This is the sixth time in seven weeks that inflows have topped $1 billion.

Huntsville Healthcare Health System plans to use a private placement to make the $450 million purchase and then refinance with bonds in late 2027.

Indiana's House Ways and Means Committee unanimously approved a plan to build a stadium to lure the National Football League's Chicago Bears.

Although Lee County has been a tourist destination, since COVID, its year-round population increased.

"For 2026, we expect municipal bonds to remain compelling as reinvestment demand stays strong and rate normalization progresses," said Brian Barney, municipal portfolio manager at Parametric.