Muni Bonds Suffering in June; Worst Month Since September 2008

Investment grade municipal bonds tracked in the S&P National AMT-Free Municipal Bond Index have seen a negative total return of 4.97%  in June so far, the worst month since September 2008 when the index was down 5.13%.  The yield (Yield to worst) on bonds in the index has risen by 95bps since the end of May.

High yield municipal bonds tracked in the S&P Municipal Bond High Yield Index have seen a negative return of 7.08% for June so far, the worst month since December 2008 when the index recorded a negative return of 9.12%.  Yields of bonds in the index have risen by 88bps for the month of June so far.

Puerto Rico remains the worst performing State & Territory with the S&P Municipal Bond Puerto Rico Index down 7.63% for June so far.  The S&P Municipal Bond Illinois Index is down 4.66% and it’s California counterpart is down 5.35%.

In comparison:

The S&P U.S. Issued Investment Grade Corporate Bond Index is down 3.16% for June to date.

The S&P U.S. Issued High Yield Corporate Bond Index is down 3.46% for June to date.

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