Where There’s Smoke, There’s Still Risk Aplenty
Our current take on tobacco settlement bonds, as published in our MuniBond Insights column.
Last Friday, the Commonwealth of Puerto Rico sent a team to New York to meet with a select group of investors as part of an outreach effort. It must’ve been a very select group because we have yet to run into anyone who attended, even among large institutional investors and major broker-dealers. In any case, the meeting so far hasn’t had the desired effect.
According to Municipal Market Data, PR credit spreads are starting to widen again. Since 3/18,10 year PR spreads vs AAA have gapped out by 15 bp to +300, only 10 bp shy of the widest spread recorded at the beginning of the year. Spreads in the 30 year range have also widened by 10 bp to about +230.
This being a spring break week in the Northeast, one probably should expect more trading volatility when market players return to the office next week.
Introducing MuniBond Insights
Introducing MuniBond Insights
A new bi-weekly muni market commentary column hosted by MuniNetGuide.com. Every Tuesday and Thursday, Triet Nguyen will offer his take on the market outlook, current relative values, the new issue calendar and other topics of interest to traders, portfolio managers and research analysts.