Regardless, investors still eye the market with some caution: government finances are still a big issue and the overall creditworthiness of bond issuers is a lingering concern. [Could Muni Bonds Be Dragging BAB ETFs?]
Roger Lowenstein for The New York Times reports that cities across the nation are still in distress, and they may not have even scratched the surface. Is the worst still to come, such as a wave of massive municipal defaults? Will state governments as well as cities be allowed to file for bankruptcy?
Although muni bond ETFs have stabilized in the last month, according to the ETF Analyzer, many of them are still hurting and few are above their long-term trend lines. If the muni space is where you want to be, consider the risks and the fact that this market could continue to see hiccups, and have your exit strategy handy.
Tisha Guerrero contributed to this article.