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Weekly Fixed Income Insights


Track what matters in fixed income: Macro news, policy moves and developments in the municipal and corporate markets.

Fixed Income Five: January FOMC

January 29, 2026

Fixed income portfolio manager Kevin Lynyak shares his insights into the current bond market. Listen now:

Fixed Income Five: Preferred Securities Outlook for 2026

January 22, 2026

Fixed income portfolio manager Kevin Lynyak shares his insights into the current bond market. Listen now:


February 10, 2026


Macro update



President Trump formally nominated Kevin Warsh—a former Fed governor—to succeed Jerome Powell as Fed Chair when Powell’s term ends in May. Warsh now faces a Senate confirmation process complicated by heightened political tensions around the Fed and scrutiny of Powell’s tenure, making the appointment a major near-term policy story for markets (Bloomberg, 2/6/2026).


According to the Institute for Supply Management, manufacturing and services remained consistent with continued expansion, but the key macro message was that prices paid remain elevated, keeping inflation anxiety alive even as growth cool (Bloomberg, 2/6/2026). 


On the data front, the highlight for markets this week will likely be the three-day-delayed payroll situation report for January, now scheduled for release on February 11. The street consensus forecast for non-farm payroll growth is for just 69,000 new jobs and follows a scant 50,000 job-creation report in December. The unemployment rate is expected to hold steady at 4.4%, and the labor force participation rate is expected to remain constant at 62.4% (Bloomberg, 2/6/2026).


Municipal bond update



AAA municipal yields were again lower to unchanged last week. Two-year yields were down seven basis points (bps), five- and 10-year yields dipped by six and three bps, respectively, and 30-year yields were again unchanged. This price action left these benchmarks at 2.11%, 2.18%, 2.60% and 4.29%, respectively (LSEG, 2/6/2026).


Five- to 30-year A-rated muni yields closed last week ranging from 2.36% to 4.65%, with related taxable-equivalent yields ranging from 3.99% to 7.85%, assuming a combined federal tax rate of 40.8% (LSEG, 2/6/2026).


Muni mutual funds saw net inflows last week of $2.4 billion, with ETFs attracting $901 million and open-end funds bringing in $1.5 billion (JPMorgan, 2/4/2026).


Tax-exempts market-performed Treasurys last week, with the Bloomberg Municipal Bond Index increasing 0.3%, compared with a 0.33% gain for the Bloomberg US Treasury Index. Munis are now up 1.24% year to date (YTD), compared with Treasurys’ 0.24% increase (Bloomberg, 2/6/2026).


Muni issuance rises to $13.4 billion this week, representing a return to the recent above-$10 billion run rate and likely including some payback from the last two lighter weeks (Ipreo, 2/6/2026).


Municipal Index Yield to Worst


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Sources: LSEG, Parametric, 2/10/2026. 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



US investment-grade (IG) corporate yields were lower across the curve last week. Two-, five-, and 10-year yields decreased three, four and three bps, respectively. Corporate yields are mixed YTD, with two- and five-year yields are down six and two bps, respectively, while 10-year yields are up by one bp (Bloomberg, 2/6/2026).


The ICE BofA 1–10 Year US Corporate Index returned 0.17% for the week and month to date (MTD). The index underperformed like-duration Treasurys by -0.07% for the week and MTD (Bloomberg, 2/6/2026).


IG mutual funds and ETFs experienced inflows of $12.9 billion, an increase from the previous week’s inflows of $11 billion. Corporate-only funds experienced inflows of $1.9 billion, following the previous week’s inflows of $3 billion (JPMorgan, 2/6/2026).


Corporate one- to 10-year IG bond yields, which have increased one bp YTD, ended last week at 4.5% (Bloomberg, 2/6/2026).



Corporate Index Yield to Worst


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Source: Bloomberg as of 2/10/2026. 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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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.