If you have muni bond funds, you might have noticed the prices have been falling lately. One big fund that I follow, the Fidelity Intermediate Municipal Income, dropped 0.68% yesterday. This LA Times Money & Company blog post
has a good review of what's happening:
The market has been slammed by the sudden convergence of several bearish trends, including rising U.S. Treasury bond yields (which drive up interest rates in general), a glut of new bonds (besides what California is offering), and ongoing concerns about the health of state and local finances.