(Bloomberg) -- States and cities are set to issue about half the amount of debt at the start of 2018 compared with a year ago.
Issuers from California to Virginia plan to take on $5.3 billion of municipal debt in the next month; that's the lowest since June 30 and down from $8.9 billion of anticipated sales during a 30-day period beginning Dec. 27, 2016.
The dearth of supply comes as states and localities sold a record $55.6 billion of debt this month through Dec. 22 as they accelerated their offerings to avoid potential changes from the federal tax-overhaul bill.
The decline means fewer bonds for investors to choose from in early 2018. That may help generate gains in the tax-exempt market, which advanced each January for the past six years, according to Bloomberg-Barclay's Municipal Bond Index.
To contact the reporter on this story: Michelle Kaske in New York at mkaske@bloomberg.net.
To contact the editor responsible for this story: Christopher Maloney at cmaloney16@bloomberg.net.
©2017 Bloomberg L.P.
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