Taxable bonds

Even with a 23.3% year-over-year drop in May, with five months now officially in the books, long-term muni volume stands at $169.45 billion, ahead of the $157.96 billion issued in 2020.

Reported savings from advance refundings make great headlines, but they come with a concealed opportunity cost: waiting with refunding until the call date is likely to be considerably more beneficial.

In Montana, two school districts and the state government reported that a new state law signed by the governor on May 6 will end the state tax deduction for certain school bonds after 2023 if those bonds are federally taxable.

With federal aid rolling out, the municipal credit picture is improving and issuers are coming to market at a faster clip. An infrastructure package could push issuance levels even higher.

The theme of low supply, positive inflows and the anticipation of higher tax rates led triple-A benchmarks firmer by one to two basis points.

The first quarter of 2021 concludes with $102.1 billion, slightly higher than the $95.3 billion that the market saw in the COVID-ravaged first quarter of 2020.

While acknowledging the critical assistance in the federal relief bill, yet in anticipation of the uncertainty ahead, further Congressional action is essential to provide state and local governments with additional tools to manage debt programs to meet the needs of their constituents.

Far West municipal issuers sold $99.1 billion of debt last year, a 16% increase from 2019.

Trade volume increased by just 4% compared to 2019 following a volatile year for munis.

From the use of taxables to forward deliveries, refunding deals drove an overall 15.8% hike in Midwest bond volume that exceeded the national average.