Market Commentary
The Next FOMC Meeting is Wednesday, May 3, 2023 with a 70.7% probability of a 25 basis point increase according to CME Group's Fed Watch Tool. US employers added 236,000 below expectations and indicating the labor market is cooling off amid Federal Reserve's repeated rate-hikes. Supply remains low for new issue municipal bonds. This week an estimated $5.4 billion supply but two issues -- California GO and San Francisco Public Utilities Commission -- made up 66% of this volume.
Market Commentary
The Next FOMC Meeting is Wednesday, May 3, 2023 with a 70.7% probability of a 25 basis point increase according to CME Group's Fed Watch Tool. US employers added 236,000 below expectations and indicating the labor market is cooling off amid Federal Reserve's repeated rate-hikes. Supply remains low for new issue municipal bonds. This week an estimated $5.4 billion supply but two issues -- California GO and San Francisco Public Utilities Commission -- made up 66% of this volume.
Market Commentary
The Next FOMC Meeting is Wednesday, May 3, 2023 with a 70.7% probability of a 25 basis point increase according to CME Group's Fed Watch Tool. US employers added 236,000 below expectations and indicating the labor market is cooling off amid Federal Reserve's repeated rate-hikes. Supply remains low for new issue municipal bonds. This week an estimated $5.4 billion supply but two issues -- California GO and San Francisco Public Utilities Commission -- made up 66% of this volume.
Market Commentary
The Next FOMC Meeting is Wednesday, March 22, 2023 with a 64.6% probability of a 50 basis point rate hike according to CME Group Fed Watch Tool. Chair Powell's comments this week indicate and even greater likelihood of aggressive Fed action to bring inflation back to acceptable levels. Data released Wednesday suggested the labor market remains strong. ADP reported private-sector jobs rose 242,000 in February, surpassing the 195,000 estimated to have been added by economists polled by IFR Markets.
Market Commentary
The Next FOMC Meeting is Wednesday, March 22, 2023 with a 64.6% probability of a 50 basis point rate hike according to CME Group Fed Watch Tool. Chair Powell's comments this week indicate and even greater likelihood of aggressive Fed action to bring inflation back to acceptable levels. Data released Wednesday suggested the labor market remains strong. ADP reported private-sector jobs rose 242,000 in February, surpassing the 195,000 estimated to have been added by economists polled by IFR Markets.
Market Commentary
The Next FOMC Meeting is Wednesday, March 22, 2023 with a 73.0% probability of a 25 basis point rate hike according to CME Group's Fed Watch Tool. Recent FOMC minutes indicate participants remain concerned about still-high inflation and committed to bringing it down to the target 2%. Muni bond yields are up across the curve, increasing ratios to US treasuries, showing relative weakness of tax-exempts to table alternatives.
Market Commentary
The Next Federal Open Market Committee meeting is Wednesday, March 22, 2023.  According to CME Group Fed Watch Tool, there is a 96.7% probability of another 25 basis point rate hike. The U.S. added 517,000 new jobs in January, well above the 187,000 forecast.  These results are drawing concerns about the Fed's prolonged tightening measures. On a relative basis, short munis are yielding about 50% of Treasuries, a ratio far below a 12-month average at 67%. This means munis are currently quite expensive.
Market Commentary
To say a lot has changed in the bond market this year would be a major understatement…changes that can largely be attributed to the actions taken by the Federal Reserve to combat persistent inflation. Let’s review where we’ve been, where we are today, and where we’re likely headed in 2023.
Market Commentary
The U.S. Treasury Secretary and World Bank spoke on inflation expectations, municipal yields drop, and bond funds see first inflows of the year, breaking a long streak of outflows. GFOA talks about revising best practices on debt and the challenge of hiring at the municipal level.
Market Commentary
Financial markets have remained volatile as investors take stock of the Federal Reserve’s efforts to tame inflation. Federal Reserve Chair Jerome Powell has stated that officials broadly agreed that additional 50-basis point (1 basis point = 0.01%) increases could be warranted in June and July given current economic conditions, but others have stated a 75-basis point increase cannot be ruled out.