Wall Street Live

Munis Stagnate in March, Await Fed's Next Move

By Max Weldon

4/3, 15:26 EDT
  • Municipal bond returns remained flat in March, with tax-exempt debt delivering exactly 0.00%, marking only the second time since 1980 that munis yielded no returns.
  • Traders adjusted expectations for delayed Fed rate cuts, reducing the appeal of munis compared to corporate bonds and Treasuries. The delay in Fed action dampened aggressive buying in March.
  • Economic data will be closely monitored for signals on the timing of monetary easing, while an increase in tax-exempt issuance to refinance old Build America Bonds could potentially boost muni performance.