After outweighing a steep decline in U.S. Treasuries over the past week, local governments tried to pull back some on Friday as they were hit by pressure over the curve ahead of a holiday-shortened but still high-supply week.
Triple-A yields rose 2 to 5 basis points, U.S. Treasuries rose for the first time in a decade, and economists continued to reassess their expectations for Federal Reserve policy, but with little consensus and more mixed results. ended the week with economic indicators.
“The chances of a rate cut next month have been significantly reduced on the back of strong employment data and stronger-than-expected inflation this week,” Barclays said in its weekly report. “Not long ago, investors were expecting a 50 basis point cut in November, but now even 25 basis points is not fully factored into federal funds futures.”
The ratios remained largely unchanged for the day, with Friday’s 2-year bond at 62%, 3-year bond at 61%, 5-year bond at 62%, 10-year bond at 67%, and 30-year bond at 62%. . The annualized rate is 83%, according to Refinitiv Municipal Market Data readings as of 3:00 PM ET. ICE Data Services was 63% two years, 62% three years, 63% five years, 68% 10 years and 83% 30 years as of 3:15 p.m.
“While the ratio has risen slightly from recent lows this week, it is still quite unattractive at current levels,” Barclays strategist Mikhail Hu said. “Going into October, we were hoping that the entry point would improve before the election, but at this point we don’t know if investors will actually get the results they expected.”
But as secondary activity picked up on Friday, JPMorgan’s Peter DeGroot said reinvested funds were “expected to plummet to near this year’s lows in the coming weeks, and therefore (mutual funds) ) Despite steady inflows, we expect the municipal market to be cheap heading into the election.
“While a departure from the recent spike in May, dealer inventories are up 10% above the average over the past year,” DeGroot said. “Generally higher inventory levels are a result of continued increases in non-taxable supply during the primaries,” he said.
“Naturally, trades are priced to clear the market, so the low bias is even stronger in weeks of high supply.”
The shortened holiday week is expected to generate about $11 billion in new issuance, led by $2.2 billion in tax-exempt and taxable transit system bonds from the New Jersey Transportation Trust Fund Authority (A2/A-/A/).
Chicago also plans to price $1.575 billion in Chicago O’Hare International Airport AMT and non-AMT general airport priority lien revenue repayment bonds on Thursday.
Recently upgraded Pennsylvania (Aa2/A+/AA/) is leading the pack by issuing $1.63 billion in general notes in three sales on Wednesday.
Tennessee’s Metropolitan Government of Nashville and Davidson Counties (Aa2/AA+//) also plans to enter the competitive market Thursday by issuing $786.66 million in general obligation improvement bonds in three sales.
“If market participants believe that the supply of Muni will be completely exhausted in November-December, the average monthly issuance in the last two months of this year has averaged about $30 billion over the past five years, so market participation “This year it will be lower, but it shouldn’t be much higher.”
DeGroot said several factors remain that support his view that the period between now and the election “could be the best time to buy municipal bonds this year and probably throughout the entire interest rate cycle.” He said there was.
CUSIP request fails
Total identification information requests for new municipal securities, including municipal bonds, long- and short-term bonds, and commercial paper, decreased 10.2% compared to August totals, according to CUSIP Global Services. On a year-on-year basis, the volume handled by local governments as a whole increased by 7.2%.
While the specific category of municipal bond identifier requests decreased by 12.9% month over month, municipal bond identifier requests still increased by 6.9% year over year.
AAA scale
Refinitiv MMD scaled down to 2.73% (+5) for 1 year and 2.47% (+3) for 2 years. As of 3 p.m., the 5-year bond is 2.44% (+3), the 10-year bond is 2.78% (+3), and the 30-year bond is 3.69% (+3).
The ICE AAA yield curve was little changed, at 2.73% (poop) in 2025 and 2.49% (poop) in 2026. The 5-year was 2.45% (+2) and the 10-year was 2.76% (+3). The 30-year was 3.63% (+2) as of 3 p.m.
The S&P Global Market Intelligence market curve showed a pullback. The one-year yield was 2.77% (+4) in 2025 and 2.50% (+3) in 2026. The 5-year was 2.45% (+3) and the 10-year was 2.45% (+3). As of 3 p.m., the annual yield was 2.75% (+3) and the 30-year bond yield was 3.64% (+3).
According to Bloomberg BVAL, interest rates are expected to be cut by 2.74% (+2) in 2025 and 2.49% (+2) in 2026. The 5-year rate is 2.47% (+3), the 10-year rate is 2.74% (+3), and the 30-year rate is 2.47% (+3). 3.64% (+2) at 3 p.m.
Government bonds have been profitable for more than 10 years.
The 2-year UST yield was 3.945% (-6), the 3-year yield was 3.861% (-5), the 5-year yield was 3.884% (-4), and the 10-year yield was 4.081% (-1). , as of 3:45 p.m., the 20-year bond is 4.444% (+1) and the 30-year bond is 4.3%9 (+1).
Main plans for the future:
The New Jersey Transportation Trust Fund Authority (A2/A-/A/) on Thursday plans to set the value of transit system tax-exempt and taxable bonds at $1.5 billion. Bohua Securities.
The New Jersey Transportation Trust Fund Authority (A2/A-/A/A) also plans to price $1.2 billion in transportation program bonds on Thursday, including $700 million in forgiveness, series 2039-2042 and taxable debt. The target is $500 million, series 2025~. 2027. Bohua Securities.
Chicago on Thursday plans to price $1.575 billion in Chicago O’Hare International Airport AMT and non-AMT general airport priority lien revenue repayment bonds, including $515.72 million in Series 2024C repayment AMT bonds; 2024D Non-AMT Bonds of $840.05 million, $158.43. $1 million in Series 2024E AMT bonds and $61,225,000 in Series 2024F non-AMT bonds. JP Morgan Securities Co., Ltd.
The Southeast Energy Agency is set to price the Energy Supply Revenue Bond at $700 million on Wednesday. Goldman Sachs & Company LLC.
The New York State Dormitory Authority will set a $500 million price tag on Thursday for White Plains Hospital Obligation Group Revenue Bonds (Baa3/BBB-//), serial numbers 2038-2053, term 2058, 2063. BofA Securities.
California’s West Contra Costa Unified School District (/AA//) on Wednesday plans to price its general obligation bonds, which are tax-exempt and taxable, at $352,785,000. Insurer: BAM. JP Morgan Securities Co., Ltd.
The Equitable Schools Revolving Fund announced on Wednesday that it has completed a $200 million Series A Senior National Charter School Revolving Loan Fund Proceeds Social Bond (/A//) through the Arizona Industrial Development Authority and the California Infrastructure and Economic Development Bank. The price is expected to be set at $444.65 million. , series 2029-2044, periods 2049, 2054, and Series B, series 2029-2044, periods 2049, 2054, 2059, for $144.65 million. Siebert Williams Shank & Co., LLC.
Pasco County, Florida School District (Aa3//AA/) records $197,195,000 in Sales Tax Revenue Bonds, Series 2024, Series 2025-2039 on the daily calendar. Bohua Securities.
ORLANDO, Fla. (/AAA/AAA/) on Wednesday plans to price water reclamation system improvement revenue and repayment bonds at $149.27 million, including $132.18 million in Series 2024A revenue bonds and $132.18 million in Series 2025 revenue bonds. ~ 2054, and $17.09 million in Series 2024B Repayment Bonds. Bonds, serials 2025-2032. Bohua Securities.
The State of Louisiana (Aa3/AA//) on Wednesday plans to price its gas and fuel tax second lien revenue refund bonds at $141.88 million. Wells Fargo Bank, NA Municipal Financial Group.
Clear Creek Independent School District of Texas (Aaa//AAA/) will price its unrestricted tax refund bonds on Wednesday at $139.74 million, including PSF guaranteed series 2024A, series 2026-2040, and $100 million. $29,055,000, and $10,685,000 for the series. 2024B (non-PSF), serial 2029. Jeffries LLC.
The New York State Dormitory Authority plans to price $111,225,000 of Montefiore Obligation Group Revenue Bonds (series 2025-2026, 2030-2044, terms 2047) on Thursday. BofA Securities.
California’s Torrance Unified School District (Aa2/AA//) plans to price its general obligation bonds Thursday at $110,385,000. Piper Sandler & Company
Manchester, N.H. (/AA-//) plans to price $108.02 million in sewer revenue green bonds on Tuesday. The publication period is from 2026 to 2044, and the periods are 2049 and 2054. Raymond James and Associates, Inc.
Grayson County Junior College District, Texas (Aa2//AA/) plans to price its general obligation bonds for consecutive years 2028-2044 and 2049 at $104.85 million. BOK Financial Securities, Inc.
The Missouri Public Utilities Commission (unrated) on Wednesday plans to set the value of the interim construction reimbursement note to be issued in 2026 at $102.5 million. D.A. Davidson & Co.
The Central Florida Tourism Oversight District (/AA-/AA-/) on Thursday plans to price Series 2024A, Series 2025-2044 ad valorem tax bonds at $99.3 million. Bohua Securities.
Palm Beach County, Florida (A1/AA-//) on Wednesday plans to price its airport system revenue improvement bond at $97.715 million, including $23.865 million in non-AMT bonds and $73.85 million in AMT bonds. It is. JP Morgan Securities LLC
Competitiveness:
Pennsylvania (Aa2/A+/AA/) plans to sell $1.63 billion in general notes in three sales Wednesday, including $235.16 million at 10 a.m. ET and $235.16 million at 10:30 a.m. $687.5 million, $707.5 million at 11 a.m. ET.
The Metropolitan Government of Nashville and Davidson Counties, Tennessee (Aa2/AA+//) will sell $786.66 million in general obligation improvement bonds in three sales on Thursday, starting at 10 a.m. $266,385,000 at 15 minutes and $258,050,000 at 10:30. 314.47 million at 10:45 a.m. ET.
The California Public Utilities Commission plans to sell $210.31 million in lease proceeds mixed-purpose bonds at 11:30 a.m. Eastern Wednesday.
The Virginia Public Schools Construction Authority (Aaa/AAA/AAA/) is scheduled to sell $132,295,000 in special obligation school loan bonds at 10:30 a.m. Eastern Tuesday.
Suffolk County, New York, will issue $164,415,000 in public improvement serial bonds at 11 a.m. Eastern Wednesday.
Nevada is scheduled to sell $116.51 million in general obligation bonds at 11:30 a.m. Eastern Tuesday.
