Report published August 17, 2026
Raymond James: Steep Municipal Curve Buoys Tax-Exempt Income Opportunities
Source and citation context
- Issuer
- Raymond James
- Report date
- August 17, 2026
- Analysis as of
- Not stated in source
Finvaulta summarizes Raymond James's analysis. Attribute opinions, forecasts, time-sensitive values, and chronology to the issuer and report date; do not treat this page as an independent verification or a current market-data source.
A steepened municipal yield curve and elevated absolute yields are creating compelling tax-exempt income opportunities, particularly in long maturities where AAA yields exceed 4% (taxable-equivalent yields >7%). Weekly municipal new issuance is anticipated to exceed $14 billion, led by large airport and municipal finance authority deals.
Key Takeaways
- 1.The municipal yield curve has steepened significantly, with the 1-to-30-year spread reaching 198 bps (compared to a 10-year average of 135 bps), creating attractive compensation for investors extending into longer maturities.
- 2.Long-term AAA municipal yields exceed 4%, resulting in taxable-equivalent yields (TEY) between 6.70% and 7.42% for investors in the highest federal tax bracket (40.8%).
- 3.Treasury curve steepened ~9 bps last week as market expectations for a September Fed rate hike fell to ~32% from ~64% two weeks prior.
Table of Contents
- Steep Municipal Curve Buoys Tax-Exempt Income Opportunities
- Yield Curve Comparison
- MARKET UPDATE
- Illustrative Portfolios (Par Value of $1 Million)
- STEEP MUNICIPAL CURVE BUOYS TAX-EXEMPT INCOME OPPORTUNITIES
- HISTORICAL YIELDS
- NEW ISSUE CALENDAR
Report data
Illustrative Portfolios (Par Value of $1 Million)
| Metric | Estimate | Context |
|---|---|---|
| Municipal Yield Curve Slope (1- to 30-Year) | 198 bps | Slope of the municipal yield curve vs 10-year historical average of 135 bps. |
| 10-Year AAA Municipal Yield | 3.18% | Equates to a 5.37% Taxable-Equivalent Yield for investors in the 40.8% federal bracket. |
| 20-Year AAA Municipal Yield | 3.97% | Equates to a ~6.70% Taxable-Equivalent Yield for top-bracket taxpayers. |
| 30-Year AAA Municipal Yield | 4.39% | Equates to a 7.42% Taxable-Equivalent Yield for top-bracket taxpayers. |
| Weekly Municipal New Issuance | 14 USD Billion | Expected new municipal issuance volume. |
Reports in this series
Municipal Bond Investor Weekly is shown in chronological order through this edition, published on August 17, 2026.
Part of the Municipal Bond Investor Weekly series — view all 8 editions
- May 11bond investor
- May 19bond investor
- Jun 1bond investor
- Jun 8bond investor
- Jun 22bond investor
- Jun 29bond investor
- Jul 13bond investor
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Reported Data Context
- Municipal Yield Curve Slope (1- to 30-Year): 198 bps (August 2026) · Source: Bloomberg LP, Raymond James
- 10-Year AAA Municipal Yield: 3.18 % (Current (August 2026)) · Source: Bloomberg LP, Raymond James
- 20-Year AAA Municipal Yield: 3.97 % (Current (August 2026)) · Source: Bloomberg LP, Raymond James
- 30-Year AAA Municipal Yield: 4.39 % (Current (August 2026)) · Source: Bloomberg LP, Raymond James
- Weekly Municipal New Issuance: 14 USD Billion (Week of August 17, 2026)