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28th July 2025

Municipal market update

Yields eased last week as the market awaits the FOMC meeting on Wednesday. The Committee is expected to maintain a pause on rates until the September 17 meeting at the earliest. Medium to long-term Treasury yields declined, with long maturities leading the reversal — dropping 8 bps on the 30-year versus just 1 bp on the 5-year.

The MMD curve saw limited movement last week, aside from a 6 bp drop in the 30-year between Monday and Tuesday. The long end of the MMD curve continues to hover near its highest point in nearly two decades, with only 2009 yields exceeding current levels. The current short end of the curve remains elevated compared to the historical average but below 2024 levels.

Currently, key rates are, on average, higher than 84% of the recorded days since 2008. The 25 and 30-year rates are higher than 10% and 11% of days, respectively.

Municipal bond fund inflows turned positive after 1 week of negative outflows, with inflows of $572 million. Supply is expected to exceed $11.8 billion this week, $800 million below last week, and estimated reinvestment dollars remain high at $55.9 billion in August before dropping to $30.8 billion in September. A Bloomberg survey indicated that economists project the Fed will keep rates static at 4.25-4.50%. Initial jobless claims came in at 217k below the expected 226k. Continuing claims came in slightly higher than expected at 1,955K vs 1,954K. The SIFMA municipal swap index rose to 2.73% vs 2.46% the previous week.

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17th November 2025

Municipal market update

The municipal market held steady last week with MMD unchanged despite a light new issue calendar last week met with uneven demand. Lipper reported steady fund inflows at $405 million with a slowing primary calendar and upcoming November and December redemption flows, providing a favorable backdrop.

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