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Weekly Fixed Income Update

Interest rates, inflation, central bank action—all these and more can impact fixed income. Stay on top of the market with our weekly update.

July 9, 2024

Macro update

Despite Independence Day, last week provided key data points on the economic front. Friday’s payroll situation report for June revealed nonfarm payrolls grew by 206,000, slightly above expectations for 190,000. The beat was overshadowed by a massive 218,000 downward revision to the prior months. This brings the three-month moving average down to 177,000, versus the six-month average of approximately 250,000, a notable deceleration (Bloomberg, 7/05/2024). 

Average hourly earnings month-over-month and year-over-year were both in line with expectations, but the unemployment rate rose to 4.1% versus expectations for an unchanged 4% rate. US Treasury yields rallied across the yield curve post-data, taking yields lower by eight to 11 basis points (bps) (Bloomberg, 7/05/2024).

This week will also offer clues to US economic momentum, with both the Consumer Price Index and the Producer Price Index scheduled for release on Thursday and Friday, respectively (Bloomberg, 7/08/2024).

Fixed Income Five by Kevin Lynyak

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Municipal bond update

Benchmark AAA muni yields were mixed across the curve last week. AAA-rated benchmark tax-exempt yields now stand 31 to 60 bps higher than at the start of the year (Refinitiv MMD, 7/05/2024).

The Bloomberg Municipal Bond Index gained 0.06% last week, placing year-to-date (YTD) performance at -0.34%. The Bloomberg US Treasury Index declined -0.86%, limiting that YTD loss to just 0.28% (Bloomberg, 7/05/2024).

Five-, 10- and 15-year A-rated municipal yields were 3.06%, 3.19% and 3.50%, respectively, as of the July 5 close. Related taxable-equivalent yields were 5.17%, 5.39% and 5.91%, respectively, assuming the highest combined federal tax rate of 40.8% (Refinitiv MMD, Parametric, 7/05/2024).

Corporate bond update

US investment-grade (IG) corporate yields fell across the curve last week. Two-, five- and 10-year yields were down 21, 23 and 15 bps, respectively. Corporate yields are higher across the curve YTD, with two-, five- and 10-year yields up 16, 27 and 33 bps, respectively (Bloomberg, 7/5/2024).

The ICE BofA 1–10 Year US Corporate Index returned 0.7% for the week and month to date. The index outperformed like-duration Treasurys on an excess-return basis by 0.17% for the week and month to date (Bloomberg, 7/5/2024).

IG mutual funds and ETFs experienced inflows of $8.3 billion, an increase from last week’s inflows of $1.9 billion. Corporate-only funds experienced inflows of $2.5 billion following last week’s inflows of $2.7 billion (JPMorgan, 7/5/2024).

Corporate one-to-10-year IG bond yields have risen 19 bps YTD and ended last week at 5.3% (Bloomberg, 7/5/2024).

Investing in fixed income securities involves risk. All investments are subject to loss. Learn more.

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Corporate Bond Market Insight

Each month we recap the corporate bond market’s performance, delving into the numbers and offering forward-looking commentary. Click below for the latest edition.

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Municipal Bond Market Insight

Each month we recap the muni bond market’s performance, delving into the numbers and offering forward-looking commentary. Check out the latest edition.


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The views expressed are those of the authors and are current only through the date stated. These views are subject to change at any time based upon market or other conditions, and Parametric and its affiliates disclaim any responsibility to update such views. These views may not be relied upon as investment advice and, because investment decisions for Parametric are based on many factors, may not be relied upon as an indication of trading intent on behalf of any Parametric strategy. The discussion herein is general in nature and is provided for informational purposes only. There is no guarantee as to its accuracy or completeness. Past performance is no guarantee of future results. All investments are subject to the risk of loss. Prospective investors should consult with a tax or legal advisor before making any investment decision. Please refer to the Disclosure page on our website for important information about investments and risks.