A surge in new municipal bond issuance is creating an opportunity for buyers, said Jim Grabovac, Portfolio Manager for the McDonell Intermediate Municipal Bond Fund. Grabovac added that municipal bond issuers are taking advantage of the current low rate environment to refinance higher rate issuance and the subsequent supply bulge is creating an entry opportunity for investors. He also said municipal valuations are quite attractive versus historical levels and demand has been consistently positive with bond funds seeing positive inflows for 5 consecutive quarters. Finally, Grabovac said bank portfolio demand has also been a feature of the market.
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