Wall Street Is Busy Buying Back Muni Bonds as Tax Bills Come Due
- Inventories of floating rate bonds have risen to $5.7 billion
- The selling may be helping push yields to highest since 2008
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Wall Street securities dealers have been busy buying back floating-rate state and local government bonds from their customers.
The firms’ inventories of so-called variable rate demand notes, which investors have the option to sell back periodically, swelled to $5.7 billion during the week ended April 4, according to the most recent figures released by the Federal Reserve Bank of New York. That’s the highest since late December and up from as little as $1.6 billion at the end of January.