(Adds details on OPEC deal)
SAN FRANCISCO, Nov 30 (Reuters) - Benchmark U.S. municipal bond prices fell on Wednesday, lifting yields as much as 10 basis points, following an announcement by OPEC to limit crude production.
Yields on AAA-rated muni bonds in the 2036-2046 maturity rose 8-10 basis points, according to a preliminary scale read from Municipal Market Data (MMD), a unit of Thomson Reuters.
OPEC agreed on Wednesday to the first oil output cuts since 2008 after Saudi Arabia accepted “a big hit” on its production and dropped its demand on arch-rival Iran to slash output, sending oil prices soaring more than 10 percent.
Greg Saulnier, muni research analyst at MMD, said the oil deal triggered a Treasuries selloff, which weakened municipals.
Issuance hit a year low in November, but is expected to return to a normal level.
“Hefty primary supply issuance is weighing on the whole market,” said Saulnier. “Once the primary issuance kicked off, it made munis extend losses.” (Reporting by Robin Respaut; Editing by Sandra Maler and Meredith Mazzilli)