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20th January 2026

Municipal market update

The World Economic Forum’s 2026 annual meeting in Davos began yesterday. This year’s proceedings are expected to draw heightened scrutiny from global markets, as the conference assumes an especially prominent role and the administration prepares to engage with European partners on the future of Greenland.

Municipal bond issuance is projected to reach approximately $11.2 billion this week, an increase from $8 billion last week.

Last week saw further yield increases for US Treasuries, focused mainly on the mid-short to mid-range of the curve. MMD significantly outperformed Treasuries, with lower yields through twenty years. Since last Monday, the 5 & 10-year MMD/UST ratios have decreased by 2 basis points.

As ratios moved lower than the 10-year average, the overall steepness of the yield curve continued to grow, with the 30-year now 158 basis points, or approximately double the 10-year average.

Lipper reported $1.80 billion in fund inflows for the week ending January 16, up from $1.50 billion the prior week as demand continued to be supportive of the market. The SIFMA Municipal Swap Index reset to 1.28%, down 9 basis points from the previous week of 1.37%.

Municipal bond issuance is projected to reach approximately $11.2 billion this week, an increase from $8 billion last week.Cabrera will serve as Co-Manager on the Los Angeles Department of Water and Power’s Power System Revenue Bonds, Series 2025D (Aa2/NR/AA-/AA).

Some of the week’s largest transactions include the following:

  • $800 million New York City Municipal Water Finance Authority, Water and Sewer System Second General Resolution Revenue Bonds, Fiscal 2026 Series BB (Aa1/AA+/AA+/NR)

  • $734 million Maryland Health and Higher Educational Facilities Authority MedStar Health Issue, Series 2026A(A2/A/NR/NR)

  • $720 million Massachusetts Development Finance Agency Revenue Bonds, Mass General Brigham Issue, Series 2026 F & H (Aaa/AAA/AAA/NR)

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26th January 2026

Municipal market update

While the FOMC will meet this week, the market implied probability of any interest rate cut is negligible, however supply is subdued with a negotiated calendar of less than $4 billion.

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