Municipal bond market shrank in 1st quarter: Fed
WASHINGTON (Reuters) - The municipal bond market shrank in the first quarter of 2012, to $3.73 trillion from $3.74 trillion the previous quarter, according to Federal Reserve estimates released on Thursday.
In the first quarter of 2011, the level of outstanding municipal debt was a much higher $3.78 trillion, according to the Federal Reserve. As the year progressed, though, issuance dropped to its lowest level since 2011, according to Thomson Reuters data.
For the fourth quarter in a row, households shed municipal bonds, dropping $195.1 billion of the debt in the first quarter of 2012 after jettisoning $135.5 billion bonds in the fourth quarter of 2011.
Meanwhile, banks, property-casualty insurance companies and mutual funds acquired municipal bonds. In the first quarter, banks gained $35.5 billion of municipal bonds, property-casualty insurance companies $16.7 billion, and mutual funds $83.1 billion.