CMF - Why Munis Offer Value Now

2025-04-08 08:43:00 ET

Summary

• The Bloomberg Municipal Bond Index is yielding 3.85%, or a 6.5% tax-equivalent yield.
• We see value in the muni market, given current valuations and market technicals, but we continue to monitor developments related to the Tax Cuts and Jobs Act.
• Within the muni bond universe, we favor essential service revenue bonds, which are issued by entities that provide everyday household needs and are backed by strong revenue streams.

By Aditi Gupta

Muni value proposition

Municipal bond yields have become attractive to US taxpayers, in our view. The Bloomberg Municipal Bond Index is yielding 3.85%, or a 6.5% tax-equivalent yield. ¹ The Bloomberg High Yield Municipal Bond Index is yielding 5.59%, or a 9.4% tax-equivalent yield. ² ...

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