"Although late-year volumes may be smaller, the market tone is holding firm on the premise of no supply/rollover demand somewhat typical for December but noteworthy for the level of volatility the market has endured," said Kim Olsan, senior vice president of municipal bond trading at FHN Financial.
Outflows continued as Refinitiv Lipper reported $3.094 billion was pulled from municipal bond mutual funds in the week ending Wednesday after $1.217 billion of outflows the week prior.
"Munis are poised to continue this rally into December as we can end 2022 on a high note and close out the worst-performing year on record for munis," said Jason Wong, vice president of municipals at AmeriVet Securities.
Total November volume stood at $19.712 billion, the lightest of any month year-to-date, in 527 versus $37.073 billion in 1,055 issues a year earlier, according to Refinitiv data.
As market participants navigate through the remaining weeks of 2022, Jeff Lipton, managing director of credit research at Oppenheimer Inc., expects munis to maintain their outperformance over USTs