BlackRock Buys High-Grade at Yield’s Tipping Point: Muni Credit
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BlackRock Inc., the world’s largest asset manager, is selling some of its riskiest municipal bonds in favor of safer local debt as $1.2 trillion of potential federal spending cuts and tax increases loom.
Debt of the least fiscally sound issuers is rallying the most since 2009, buoyed by the biggest wave of cash in at least two years flowing into high-yield muni mutual funds. Local bonds rated below investment grade have earned 15 percent this year, compared with 6.9 percent for the rest of the $3.7 trillion muni market, Standard & Poor’s indexes show.