March 2017, WEEK OF THE 20th

Last week’s new issue municipal supply remained below the 2017 weekly average with just $6.2 billion priced into the market. The week started with a flurry of activity as the deals scheduled for Monday-Tuesday either accelerated pricings on Monday or postponed to later in the week due to the prediction of a large winter storm impacting business through most of the Northeast. With the winter storm blown off to sea, the market remained quiet on Wednesday as traders awaited the FOMC rate decision and press conference. Post winter storm and FOMC, municipal bonds rallied along with other fixed income investments, with yields dropping so that both treasury and municipal rates ended the week at lower yields. The 10 year treasury closed Friday at 2.501%, down 7.4 bps week over week.  The 30 year treasury finished the week at 3.11%, down 5.5 bps from last Friday’s close. The 10 and 30 year MMD indexes closed last week at 2.40% and 3.18%, down 7 bps and 6 bps respectively from the prior week.   As of Friday, the percent of municipals to treasuries was 95.96% for the 10 year maturity and 102.25% for the 30 year maturity. 

Housing issuers in the market over the last two weeks included: State of New York Mortgage Agency, MassHousing, Utah Housing Corporation, Vermont Housing Agency, West Virginia Housing Development Fund, Ohio Housing Finance Agency and Minnesota Housing Finance Agency with single family issues most of which had more than one series of bonds. The multifamily deals sold over the last two weeks were issued by New York State Housing Finance Agency, Eden Prairie (MN), Illinois Housing Development Authority, Iowa Finance Authority and the City of Rolla (MO) Industrial Development Authority. Details about these transactions can be found inside the attached Market Roundup. 

Economic data released this week includes: FHFA House Price Index, Existing Home Sales, Jobless Claims, New Home Sales, and Durable Goods Orders. This week’s supply is anticipated to be light at $5 billion. This week the housing deals on the calendar include the following:

$ 57,615,000  Washington State Housing Finance Commission

$ 16,900,000  California Statewide Community Development