March's inflation data brought more bad news, but there were some potential bright spots. A historic first quarter in the muni market and recent trends look like they will continue.
Broad bond market indices have suffered through the first quarter of 2022, producing some of the worst returns on record. Municipals have not been spared during this time, as year-to-date outflows from municipal mutual funds have already exceeded those for the entirety of 2022.
A light week in the municipal bond market in expectation of the widely anticipated rate hike from the Federal Open Market Committee that meets mid-week.
Inflation concerns persist, and it appears to be taking its toll, as after-tax income and consumer confidence drop. Geopolitical factors will be monitored closely but have not changed expectations that interest rates will rise in 2022.
With plenty of uncertainty moving into the second half of February, financial markets continue to grapple with volatility. Equities are on a roller coaster and muni yields continue to trend upward.
The Federal Open Market Committee emerged from its policy meeting last week with its statement on monetary policy and the market takes note. Volatility dominated nearly all financial markets in the first month of 2022.
Inflation concerns continue to be top of mind for many market observers, while growth forecasts are revised downward. The likelihood of rate increases has shifted significantly as the Fed monitors inflation and employment.
A stable end to 2021, New Year's expectations that we will still be dealing with the uncertainties related to the pandemic and Fed policy were confirmed with the release of the most recent Federal Open Market Committee meeting minutes.
Reactions to actions announced upon conclusion of the Federal Reserve's Federal Open Market Committee December meeting, where we might go from here, and what the markets think about it.
The emergence of the omicron COVID variant has certainly garnered much attention in the financial markets, but the center of gravity still revolves around the Federal Reserve and the future of its monetary policy actions.
Difficult First Quarter of 2022 for the Municipal Market & Some Inflation Insights
Trend of Rising Rates Continues and Yield Curve Flattens Further
Municipal Bond Markets Quiet this Week in Light of Geopolitical Uncertainty & FOMC Meeting
Inflation & Pace of Rate Increases Still Front & Center
What Will Come Next?
Volatility Prevails as We Begin 2022
Inflation, Tapering, Potential Rate Hikes…Among Other Worries…Dominate Economic Headlines
A New Year, Continuation of Trends
Pendulum Shift
The Fed Remains the Center of Attention