Municipal bonds sold off on Tuesday, with benchmark yields rising as much as eight basis points, as new inflation data caused traders to par back expectations for an interest-rate cut in September.
The yield on the 10-year muni benchmark rose eight basis points to 3.25% in the market’s worst day since tariff-fueled volatility in April.
US Treasuries also sold off after the release of the data, which signaled that companies are beginning to more meaningfully pass some tariff-related costs to consumers. State and local debt tends to follow Treasury moves.
Bloomberg Markets
By Aashna Shah
July 15, 2025