Rates Over Time - Interest Rate Trends
The following graphs set forth
information relating to municipal bond yields (interest rates) trends.
Four of the graphs are based on "The Bond Buyer 20-Bond GO Index".
The 20-Bond GO Index is based on an average of certain general
obligation municipal bonds maturing in 20 years and having an
average rating equivalent of Moody's Aa2 and Standard & Poor's AA. The five graphs
below are as follows (i) yields for the past ten years, (ii) weekly
yields over a twenty-four month period ending February 13, 2020
(iii) yields since 1970, (iv) a comparison of the 20-Bond GO Index to 20-year US Treasury Bonds,
and (v) the Municipal Market Data index for rating grades "Aa", "A"
and "Baa" maturing in the 20th year. The fifth graph
highlights the credit spread crisis that emerged during 2008 that
now appears to reflect a new normal.
Prior to 2008 the spreads between rating grades were generally less
than 30 basis points ( .30%). Spreads between rating
grades, for bonds rated AA and lower, are now approximately 40 basis points