Ajay Thomas in Bloomberg

“You have a combination of issuers needing to replace and renew aging infrastructure, and the needs to finance new development to support growth,” Ajay Thomas, head of public finance at FHN Financial, said in an interview. The proliferation of data centers being built to power the artificial intelligence boom will spur debate on how to manage demand, he said.

Some water and sewer issuers also may be tapping into higher interest from investors trying to diversify beyond general obligation muni bonds, FHN’s Thomas said. Looking ahead, demand from data centers will also be a factor, he said.

“Data centers are absolutely part of the conversation and a matter of the policy and resource implications,” Thomas said.

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