• Fiscal fortunes for state and local governments took a decided turn in January with the outcome of the special elections resulting in unified government accompanying the incoming administration. Market participants quickly began pricing in fiscal relief that would likely provide aid for state and local governments.
  • New issue volume during the first quarter rose modestly in comparison to last year’s pandemic-subdued pace. While issuance of both tax-exempt and taxable municipals rose slightly, the percentage of issuance coming as taxable fell to 26% from 30% over the past year.
  • Market participants have much to monitor on the legislative front, but a strengthening economy that may soon be opening more fully could warrant equal attention.