A key takeaway from our 2021 survey results is that there is not a clear-cut, or leading issue influencing the municipal bond market right now.
The coronavirus (COVID-19) pandemic was named by only 47% of those surveyed as one of the most important issues/ trends influencing the municipal bond market in our December 2021 survey of 150 municipal bond credit analysts. Last year, in April 2020, 92% of analysts indicated COVID-19 as a top-five issue or trend.
There is also a much wider range of issues or trends that analysts believe are influencing the municipal market.
Public pensions (32%) was a key trend for analysts before COVID-19, this year it dropped to the fifth most important.
Municipal analysts are closely divided about the appropriateness of the amount of fiscal policy that was focused on public finance in 2020 and 2021.
Opinions about both state and local government credit quality mostly strengthened in 2021 compared to results from our 2020 survey.
A little over half of analysts are satisfied in some way with municipal bond market disclosure.
Most analysts do not think state and local governments are prepared for climate change or cyber attacks.
Analyst opinions’ about how the rating agencies handled COVID-19 is mostly favorable.
We also saw that analyst opinions’ overall about the rating agencies have improved across the board in the results of our 2021 analyst survey.