Weekly Fixed Income Insights
Track what matters in fixed income: Macro news, policy moves and developments in the municipal and corporate markets.
Warsh Delay: What, Now What, So What for Rates
April 22, 2026
Fixed income portfolio manager Kevin Lynyak shares his insights into the current bond market. Listen now:
FOMC Recap
April 30, 2026
Fixed income portfolio manager Kevin Lynyak recaps the FOMC meeting and bond market reaction. Listen now:
May 26, 2026
Macro update
Markets stabilized last week as easing geopolitical tensions in the Middle East and lower oil prices helped reverse part of the prior inflation and rates shock. Brent crude moved back below $100 per barrel, while West Texas Intermediate (WTI) declined toward the low $90s as investors increasingly priced a potential ceasefire and reduced disruption risk through the Strait of Hormuz (Bloomberg, 5/22/26).
Treasury yields moved modestly lower on the long end while the curve flattened amid increasingly hawkish Fed commentary. The two-year Treasury yield rose to approximately 4.12% while the 10-year declined modestly to roughly 4.56%, reflecting higher policy rate expectations even as inflation-risk premia eased alongside lower energy prices (Bloomberg, 5/22/26).
Federal Reserve rhetoric continued to shift in a more hawkish direction, as Fed governor Christopher Waller stated that “a rate cut is no more likely than a rate increase,” while recent Federal Open Market Committee (FOMC) minutes indicated several policymakers remain open to additional tightening should inflation fail to moderate further (Bloomberg, 5/22/26).
Economic data continued to support the “higher for longer” narrative, with growth remaining resilient and consumer activity firm. Markets are focused on this week’s core PCE inflation and personal spending data, while the Atlanta Fed’s GDPNow estimate for second-quarter growth remains elevated at 4.3% (Bloomberg, 5/22/26).
Credit markets remained resilient despite higher front-end Treasury yields and were supported by continued demand for carry and strong primary market activity while experiencing strong ETF inflows, oversubscribed issuance and selective duration extension by investors (Bloomberg, 5/22/26).
Municipal bond update
AAA municipal yields were unchanged to mildly higher across the curve last week. Two- and five-year yields were unchanged and up four bps, respectively, while 10- and 30-year yields rose five and four bps, respectively. This modest price action left these benchmarks at 2.57%, 2.77%, 3.14% and 4.50%, respectively (LSEG, 5/22/26).
Five to 20-year A-rated muni yields closed last week ranging from 2.97% to 4.43%, with related taxable-equivalent yields ranging from 5.02% to 7.48%, assuming a combined federal tax rate of 40.8% (Parametric, LSEG, 5/22/26).
Muni mutual funds saw massive inflows again last week, at $1.5 billion. ETFs attracted $979 million and open-end funds gained $543 million (Lipper, JPMorgan, 5/20/26).
Tax-exempt bonds underperformed Treasurys last week, with the Bloomberg Municipal Bond Index losing 0.28%, compared to a 0.18% gain for the Bloomberg US Treasury Index. Munis are now up 0.31% year to date (YTD), and Treasurys are down 0.78% (Bloomberg, 5/22/26).
Muni issuance for this holiday week eases to $7.1 billion weekly, representing a break from three prior weeks of above $12 billion issuance (Ipreo, 5/22/26).
Municipal Index Yield to Worst
Sources: LSEG, Parametric, 5/27/2026. Assuming a top federal tax rate of 37%, plus 3.8% net investment income tax rate, 40.8% combined. For illustrative purposes only. It is not possible to invest directly in an index. Past performance is no guarantee of future results.
Corporate bond update
The ICE BofA 1-10 Year US Corporate Index returned 0.25% for the week and -0.16% month to date. The index outperformed like-duration Treasurys by 0.05% for the week and by 0.34% month to date (Bloomberg, 5/22/26).
U.S. investment-grade (IG) corporate yields were mixed across the curve last week. Two-year yields were up one bp while five- and 10-year yields fell one and four bps, respectively. Corporate yields are higher YTD, with two-, five- and 10-year yields up 50, 49 and 38 bps, respectively (Bloomberg, 5/22/26).
IG mutual funds and ETFs experienced inflows of $8.9 billion, a decrease from the previous week’s inflows of $9.3 billion. Corporate-only funds experienced inflows of $1.3 billion, following the previous week’s inflows of $3.4 billion (JPMorgan, 5/22/26).
Corporate one- to 10-year IG bond yields, which have increased 46 bps YTD, ended last week at 4.9% (Bloomberg, 5/22/26).
Corporate Index Yield to Worst
Source: Bloomberg as of 5/27/2026. Past performance is no guarantee of future results. The index performance is provided for illustrative purposes only and is not meant to depict the performance of a specific investment.
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