After its first monthly decline of the year, the municipal bonds market and related exchange traded funds are now trading at their cheapest relative to Treasuries in nine months.

The iShares National AMT-Free Muni Bond ETF (NYSEArca: MUB) fell 0.9% over the past month. Nevertheless, MUB is up 8.1% year-to-date. MUB has a 6.43 year effective duration and a 1.62% 30-day SEC yield, or a 2.86% tax equivalent yield. [Why an ETF May Make Sense for Munis Exposure]

Meanwhile, the iShares 7-10 Year Treasury Bond ETF (NYSEArca: IEF) fell 0.8% over the past month and is still up 7.8% year-to-date. IEF has a 7.6 year effective duration and a 2.03% 30-day SEC yield.

As a result of the brief pullback in the munis market, benchmark 10-year municipal bond yields are now at around 2.28% while 10-year Treasury bond yields are at 2.34%.

The ratio of the two interest rates is used as a measure of relative value between the two asset classes, and at 98%, the ratio is now close to its highest since February, revealing that munis have weakened relative to Treasuries, reports Brian Chappatta for Bloomberg.

Fixed-income investors have accepted the lower yields on munis relative to Treasuries due to the tax perks of investing in municipal debt.

As a result of the outperformance in the munis market this year, the ratio between the two interest rates averaged 92.6% in 2014, compared to 98% five-year average.

However, the munis market is moving toward its first monthly loss as states and cities start issuing their most new bond sales to end a year since 2011. According to Bank of America Merrill Lynch data, the munis market is down 0.28% so far this month. Bond prices and their yields have an inverse relationship, so a rising yield corresponds with falling price.