Municipal Debt Industry Update
Primary Muni Deals Going Day-to-Day Reflect Second Week of Muni Outflows, Cautious Investor Sentiment
The last week of January 2022 had $1.15 billion scheduled to price with the largest deals coming from high-yield bond issuers. But market technicals and macros headwinds beached a few of them, said market sources.
The largest of the week’s primary offerings was $419 million from the New Hope Cultural Education Facilities Finance Corp. on behalf of the Dwyer Workforce Development Portfolio Project, which initially launched in December 2021. A $113 million offering from the California Statewide Communities Development Authority, or CSCDA, for an essential housing project called The Crescent – West Hollywood was the third-largest issuance of the week. CSCDA priced just before trading closed for the week.
Last year, the high-yield municipal bond market was awash with inflows, and risky structures and credits could easily access capital. With the municipal market undergoing its second straight week of outflows, breaking a 45-week positive flow streak, cash pulled to the sidelines by spooked investors slowed the high-yield pipeline. The outflows are not expected to be a permanent pattern at this time and largely reflect inflation and rate hike concerns of investors, according to market participants.
Read the full industry update: https://reorg.com/municipal-debt-industry-update/