BofA Says ‘Disappointing’ Muni Issuance Spurs 2026 Forecast Cut

Bank of America Corp. has trimmed its forecast for 2026 municipal-bond issuance by about 6% to $600 billion as rising yields contribute to a slowdown in refunding transactions.

The market for US state and local debt is closing out a tough month. With the Middle East conflict boosting oil prices and sparking inflation concerns, bond yields have surged. Yields on 10-year benchmark munis have climbed more than 60 basis points in March, to around 3.1%, the highest since September, data compiled by Bloomberg show.

The selloff this month is “problematic for refunding activity,” municipal research strategists led by Yingchen ...