(Bloomberg) -- Chicago plans to tap the muni market for $1.5 billion early next month to refinance its debt as it looks to capitalize on the Federal Reserve lowering interest rates.
The city will have $850 million in general obligation bonds available to replace with new debt. The deal, which also includes a debt buyback process, is expected to generate $110 million in savings.
“We are planning on pricing the first week of December,” Chicago Chief Financial Officer Jill Jaworski said in an email on Friday. “We do not have any comments on how day-to-day market movements impact the sale.”
Benchmark 10-year muni yields have risen more than 12 points since the Chicago City Council passed Mayor Brandon Johnson’s proposed refinancing bond deal on Oct. 22.
Munis have been particularly volatile this week. AAA muni yields surged on Wednesday, the day after the Nov. 5 election, on concerns that the federal deficit would grow even bigger because of Donald Trump’s policy proposals. They have since eased.
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