Weekly Fixed Income Insights
Track what matters in fixed income: Macro news, policy moves and developments in the municipal and corporate markets.
FOMC Recap
April 30, 2026
Fixed income portfolio manager Kevin Lynyak recaps the FOMC meeting and bond market reaction. Listen now:
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:
May 6, 2026
Macro update
Bond yields rose while equities rallied last week, as U.S. Treasurys bear-flattened on higher energy prices and a hawkish Federal Open Market Committee (FOMC) press conference. The two-year maturity rose 10 basis points (bps) and the 10-year rose seven bps to 4.37%, the highest since July 2025 (Bloomberg, 5/1/2026).
The FOMC kept the overnight fed funds target at 3.50% to 3.75%, but the eight to four vote placed the focus on the dissenting votes. Only one of the dissenting votes was in favor of a rate cut and the other three were in favor of a statement change to remove the easing bias. Meanwhile, Fed Chair nominee Kevin Warsh was approved by the Senate, making the April meeting Jerome Powell’s last as Fed Chair, though he will remain on the board of governors (Bloomberg, 5/1/2026).
Q1 2026 GDP was resilient, but much of it was capital expenditures. Real GDP rose 2.0%, with consumption slowing to 1.6%. Business investment, especially tech-related equipment, was a key driver, reinforcing AI infrastructure as a support for growth (Bloomberg, 5/1/2026).
Economic data releases scheduled for this week include ISM, jobless claims and the April payroll situation report. Consensus expectations are for 65,000 new jobs created, an unchanged unemployment rate and a slight uptick in Average Hourly Earnings of 0.3% month over month from the prior 0.2% reading (Bloomberg, 5/1/26).
Municipal bond update
AAA municipal yields were higher across the curve last week. Two- and five-year yields rose 10 and nine bps, respectively, while 10- and 30-year yields were seven and six bps higher, respectively. This mild price action left these benchmarks at 2.47%, 2.60%, 2.98% and 4.33%, respectively (LSEG, 5/1/2026).
Five to 20-year A-rated muni yields closed last week ranging from 2.80% to 4.30%, with related taxable-equivalent yields ranging from 4.73% to 7.26%, assuming a combined federal tax rate of 40.8% (Parametric, LSEG, 5/1/2026).
Muni mutual funds saw net inflows continue last week at $615 million. ETFs gained $492 million and open-end funds added $123 million (Lipper, JPMorgan, 4/29/2026).
Tax-exempts performed in line with Treasuries last week, with the Bloomberg Municipal Bond Index losing 0.34%, compared to a 0.39% decrease for the Bloomberg US Treasury Index. Munis are now up 0.98% year to date (YTD), and Treasurys are down 0.04% (Bloomberg, 5/1/2026).
Muni issuance resumes its $10+ billion weekly trend line this week, with $12.5 billion scheduled to enter the primary market (Ipreo, 5/1/2026).
Municipal Index Yield to Worst
Sources: LSEG, Parametric, 5/5/2026. 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 -0.29% for the week and 0.54% in April. The index outperformed like-duration Treasurys by 0.01% for the week and by 0.47% in April (Bloomberg, 5/1/2026).
U.S. investment-grade (IG) corporate yields increased across the curve last week. Two-, five- and 10-year yields rose eight, ten and eight bps, respectively. Corporate yields are higher YTD, with two-, five- and 10-year yields up 35, 32 and 26 bps, respectively (Bloomberg, 5/1/2026).
IG mutual funds and ETFs experienced inflows of $3.7 billion, an increase from the previous week’s inflows of $2 billion. Corporate-only funds experienced inflows of $78 million, following the previous week’s inflows of $30 million (JPMorgan, 5/1/2026).
Corporate one- to 10-year IG bond yields, which have increased 35 bps YTD, ended last week at 4.8% (Bloomberg, 5/1/2026).
Corporate Index Yield to Worst
Source: Bloomberg as of 5/5/2026. 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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