Municipal market update

The municipal market remained firm last week as supply was lighter than usual due to the FOMC meeting and the Juneteenth holiday. Supply continues to build with approximately $11 billion expected to come to market this week, with about 40% expected to be priced in the competitive market. Year-to-date issuance is pacing approximately 4–7% ahead of last year’s record-setting volume. Recent activity has been particularly robust in the water and utility revenue and general obligation sector.

Last week, the Federal Reserve elected to hold rates steady at 3.50%–3.75% for the fourth consecutive meeting. Notably, the Fed removed its prior easing bias from the policy statement, signaling a shift toward a more neutral stance and less certainty around the direction of future moves. Market resilience continues to be supported by strong investor demand for municipal bonds, with Lipper reporting a ninth consecutive week of fund inflows.

The SIFMA Municipal Swap Index reset to 2.59%, 30 basis points below the prior week.

This week, Cabrera will serve as Senior Manager on $221.54 million Grand Prairie Independent School District Unlimited Tax Refunding Bonds, Series 2026A & B and Co-Manager on $1.442 billion City of Los Angeles 2026 Tax and Revenue Anticipation Notes and $223.15 million Collin County Limited Tax Permanent Improvement Bonds, Series 2026. The three largest transactions of this week include the following:

• $1.442 billion City of Los Angeles 2026 Tax and Revenue Anticipation Notes

• $1.000 billion The Black Belt Energy Gas District Gas Project Revenue Bonds 2026 Series J (A1/NR/NR/NR)

• $400 million Ohio Water Development Authority State of Ohio State Revolving Fund Revenue Bonds Series 2026A (Aaa/AAA/NR/NR)