S&P Eyes Credit Headwinds for Muni Market in 2024
- Negative outlooks for mass transit and public power sectors
- Debt issuance could accelerate if interest rates lowered
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Higher interest rates, inflation and slower economic growth could create headwinds for the US public finance sector, S&P Global Ratings said in a report Friday.
Continuing credit strength has led to growing revenues and expanded reserves, S&P analysts led by Robin Prunty wrote in the report. “However, if local or macroeconomic conditions prevent revenues from keeping pace with expenditure growth, management teams could be pressured to balance budgets while still addressing persistent issues requiring longer-term solutions,” Prunty said.