Nowhere to Go But Up? A Municipal Perspective
Munis outperformed Treasury’s strongly with a 0.80% return versus 10-Year Treasury of -0.90%. Closed end funds were stronger this week with a 1.59% return.
Ratios fell for the week but the 10-Year currently at 85% is still cheaper than the 1 year average of 79% and 30-Year at 96% is still cheaper than the 1-Year average of 89%.
Cash flow for the industry continues to be negative with approximately $80B leaving the market year to date but offsetting some of that is higher than average calls, maturities and dividend re-investment. Additionally new issuance is still below most yearly estimates.
One more -- the AAA muni curve is more positively sloped compared to treasuries: