Bond Issuance in Credit Markets to Remain Strong in 2007 at
$4.4 Trillion, but Moderate from 2006 Level; CDO, Money Market
Volumes Expected to Increase

• Total 2007 long-term issuance for the covered sectors is expected to decrease 4.3 percent to $4.4 trillion, compared to $4.6 trillion issued in 2006. There is a forecasted volume gain in 2007 over 2006 of approximately $78 billion if the net increase in projected commercial paper outstanding is included.
• Long-term municipal issuance in 2007 will be $350 billion, 9.1 percent lower than the 2006 volume of $385 billion.
• Corporate issuance will be $889 billion in 2007, 14.1 percent less than the $1.04 trillion issued in 2006.
• ABS issuance in 2007 will be $715 billion, down 4.7 percent from the $750 billion issued in 2006.
• CDO issuance will be $369 billion in 2007, 12.1 percent higher than the previous record of $330 billion issued in 2006.
• Mortgage-related issuance will be $2.07 trillion in 2007, down 2.5 percent from the 2006 issuance volume of $2.12 trillion. Agency mortgage-related volume will be $1,146 billion in 2007 compared to $1,190 billion in 2006, and private label issuance will be $975 billion compared to $972 billion in 2006.
• Commercial paper outstanding will be $2.17 trillion at the end of 2007, an increase of 12.5 percent over $1.92 trillion outstanding on November 30, 2006.

About the Report

This report provides information on anticipated issuance volumes and interest rate and credit spread outlooks for 2007 in the municipal, corporate, money market and securitization markets. The forecasts are based on a survey of the Association’s member firms conducted during December 2006. Specialists at member firm in each of the market sectors provided the forecasts, indicating key assumptions behind their projections.

Credits

SIFMA Research

• Senior Managing Director, Head of Research and Public Policy: Michael Decker
• Managing Director: Steven Davidson
• Vice President, Industry Research: Marcelo Vieira
• Director, Research: Tiffany Coln
• Director, Research: Bryan Gross