Last July we opined on the steepness of the municipal yield curve and some interesting income opportunities that were available as a result (Steep Yield Curve Presents Income Enhancing Opportunities 7/30/13). With tax exempt yields continuing to rise in August, we wanted to once again highlight some noteworthy developments across the yield curve.
It’s summer. Financial markets are supposed to be in sleep mode till Labor Day. BUT, that has hardly been the case as volatility and uncertainty remains elevated in all asset classes as we approach a possible inflection point in the Federal Reserve’s Quantitative Easing Program (QE).
Bond markets continue to retrace from the 2013 yield highs established on July 5th. For the week ending July 12th, 10 year US Treasuries closed with a yield of 2.58%. 10 year AAA Municipals closed with a yield of 2.66% (103% of Treasuries).
There have been two historically significant opportunities in the tax exempt market over the last five years. The question is: are we in the middle of a third?
The financial markets have experienced a sharp rise in volatility of late, as investors wrestle with the uncertainty of central bank policy and the future direction of interest rates. With 10 year US Treasury rates rising to their highest yield in 15 months, mutual fund shareholders have redeemed shares at a level not seen since … Read more
EJ Reinoso provides commentary to Bloomberg News following S&P’s downgrade of U.S. credit, in this morning’s article “Muni Market Prepares for Loss of AAA Ratings as S&P Downgrades U.S. Credit.”