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Municipal-Bond Rally Pushes Yields to Lowest in Four Weeks

November 01, 2011

Yields touched their lowest in more than two years on Oct. 6. Ten-year Treasuries dropped to 1.98 percent today, from 2.40 percent on Oct. 27. "We've had a 40-basis-point rally in the 10-year Treasury," said Tom Boylen, a trader at Chicago-based Performance Trust Capital Partners. "Munis had some catching up to do." The ratio of interest rates on top-rated 10-year munis to those on Treasuries rose to 113 percent yesterday. The high ratio is attracting investors to munis who would ordinarily buy other types of debt, Boylen said in a telephone interview.

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