- Yields on muni bonds jumped as much as 16 basis points
- Investors of muni debt tend to take cues from Treasury market
Municipal bonds plummeted on Wednesday after voters elected Donald Trump as US president. The move followed a rout in US Treasuries, which sold off over concerns that Trump’s policies will widen an already bloated budget deficit and cause inflation to surge.
Benchmark municipal-bond yields jumped as much as 16 basis points as of 4 p.m. New York time.
“A Trump win signals to the market that some proposed policies have a chance at sunlight, many of which could re-ignite inflation,” said Eric Kazatsky, senior US municipals strategist for Bloomberg Intelligence. “US Treasuries are speaking that fact to the market and dragging munis along for the ride.”
Bloomberg Markets
By Danielle Moran and Lily Meier
November 6, 2024