Scott Hutchings

May felt reassuringly pedestrian comapred to the
near-historic volatility that occurred in April as a result of President Trump’s “Liberation Day” tariff announcement, which now feels like a lifetime ago.

In like a lion and out like a lion, beware the Ides of March. The month of March was unkind to municipal bond investors as the market became untethered from all other markets. As a result, municipals under-performed the US Treasury market significantly across the curve. As noted above, 10-year AAA municipal rates rose nearly 35 bps while 10-year UST yields were unchanged.

Positive performance for both the investment grade and high yield municipal indices continued in February as they returned 1.00% and 1.26%, respectively. That is the second straight month of outperformance for high yield and 11 out of the last 14 months dating back to the beginning of 2024.