Primary bond market

The bank has also hired some analysts to its infrastructure group over the past several weeks as it plans to beef up its muni team.

The negotiated calendar is led by the Regents of the University of California with nearly $1 billion of general revenue bonds.

High rates and high inflation, coupled with rich reserves, pushed off or delayed issuers coming to market in 2023, noted James Pruskowski, chief investment officer at 16Rock Asset Management.

Municipals look poised to close out February a touch in the black following a more constructive tone Thursday after being in a 'holding pattern' for much of the past two weeks.

Issuance is already slated to be healthy next week, with some large deals on the calendar.

Three of the hires are group heads in public sector and structured finance businesses at the firm.

Munis should remain well bid until issuance picks up "dramatically," said Nuveen's Anders S. Persson and Daniel J. Close.

The authority is one of the few investment-grade U.S. issuers actively selling triple-tax-exempt paper.

CreditSights said states with the largest payments are Texas at $2 billion, Pennsylvania at $1.5 billion, South Carolina at $1.3 billion and California at $1.2 billion

With a recent court ruling and higher interest rates in their favor, more issuers are likely call back their outstanding BABs using the extraordinary redemption provision.

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.

The week ahead boasts some big-name issuers and rare credits, which should provide interesting price discovery. The new-issue calendar totals $6.08 billion, with a larger competitive calendar coming in at $2.4 billion.

Supply is expected to increase in the coming weeks, and there may be more rate-direction volatility, said Kim Olsan, senior vice president of municipal bond trading at FHN Financial.

Natural gas prepayment deals helped drive the utilities sector to top the Southeast in an overall down year for municipal bond sales across the region.

Policymakers appear to be concerned about the possibility of cutting interest rates too soon, according to minutes of the Federal Open Market Committee's Jan. 30-31 meeting, released Wednesday.

"With the new economic data signaling a delay of the Fed starting rate cuts to further into the year, we should continue to see yields rise until we get near to the Fed's target of a 2% 'neutral' rate for inflation," said Jason Wong, vice president of municipals at AmeriVet Securities.

A private university in Milwaukee will borrow $163.7 million through tax-exempt bonds to build new emergency response facilities for the state and county.

All municipal bond insurers wrapped $35.381 billion in 2023, a 5.8% increase from the $33.428 billion insured in 2022, according to LSEG data.

Bond volume fell slightly, as volatility, higher interest rates, falling pandemic aid and slower economic growth kept issuers on the sidelines.

Issuance has fluctuated throughout the years since the financial crisis, following interest rate changes — rising when rates rise and falling when rates fall — but the totals have come in well below $15 billion every year since 2012, save for 2017 when $15.234 billion was sold.