Municipal bonds and related muni bond ETFs are bouncing back from the losses earlier in the year as U.S. states and cities cut back on new issues.

Year-to-date, iShares National AMT-Free Muni Bond ETF (NYSEArca: MUB) dipped 0.4%, SPDR Nuveen Bloomberg Barclays Municipal Bond ETF (NYSEArca: TFI) fell 0.8% and VanEck Vectors AMT-Free Intermediate Municipal Index ETF (NYSEArca: ITM) dropped 0.9%, erasing most of the losses from February through April.

Prices on munis have more or less recovered from their worst first-quarter slump in 15 years as municipalities continue to reduce borrowing, reports Heather Gillers for the Wall Street Journal.

Municipalities borrowed $156 billion over the first half of the year, or down 17% from last year. Citigroup researchers project borrowings could fall as much as 25% by the end of 2018 year-over-year.

Meanwhile, the sudden dearth in supply has helped prop up valuations of existing debt and diminished borrowing costs for some governments, notably riskier bond deals.

“It’s a seller’s market,” Howard Cure, director of municipal-bond research at Evercore Wealth Management, told the WSJ. “We’re trying to be careful about that aspect of it and not go down that path of sacrificing for a little extra yield and having a big decline in credit quality.”

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