Despite the attraction for new issues, sources said there is still uncertainty overall in the municipal market stemming from the regional banking crisis.
Now that there is more "clarity from the Fed on the path of interest rates, both investors and issuers may start to move off the sidelines," said Daniel Close, head of municipals at Nuveen.
The Investment Company Institute reported $289 million of inflows into municipal bond mutual funds in the week ending Dec. 1, down from $965 million in the previous week.