The muni bond market had its strongest quarter in almost two years.
Municipal bonds gained 4.45% in the second quarter, the strongest performance for munis since the third quarter of 2009, according to news reports.
During the same period, Treasuries were up 2.284%, while corporate debt gained 2.295%.
The strengthening market comes on the heels of a raft of issuance last year by municipalities seeking to take advantage of the Build America Bonds program before it expired, and the fear mongering by a few high-profile pundits.
Investors have been encouraged by the willingness of state and local governments to make difficult spending cuts as they sought to balance their budgets in a challenging economic environment.