Weekly Fixed Income Insights
Track what matters in fixed income: Macro news, policy moves and developments in the municipal and corporate markets.
Q1 Credit Recap: Higher Rates, More Supply, an Oil Shock—and Rising Private Credit Concerns
April 7, 2026
Fixed income portfolio manager Kevin Lynyak shares his insights into the current bond market. Listen now:
CBO, Tariffs, AI, and the Strait of Hormuz
March 18, 2026
Fixed income portfolio manager Kevin Lynyak shares his insights into the current bond market. Listen now:
April 14, 2026
Macro update
Headline inflation has re-accelerated, but the core is still anchored, with the March Consumer Price Index coming in strong at +0.9% month-over-month (MoM), but the core was softer at +0.2% MoM, reinforcing the “headline noise vs. core stability” narrative and keeping the Fed reaction function data-dependent rather than hawkishly reactive. Meanwhile, consumer cracks are emerging beneath the surface. The University of Michigan sentiment fell sharply to 47.6 compared with 51.5 expected, while one-year inflation expectations jumped to 4.8%, highlighting a growing divergence between easing core inflation and deteriorating consumer confidence—an unfavorable mix for real income dynamics and forward consumption (Bloomberg, 4/13/2026).
Treasuries rallied modestly last week with the curve steepening, as front-end yields declined on softer core inflation and residual Fed cut optionality, while long-end volatility remained tied to energy and geopolitics.
Earnings season begins this week, and the focus shifts to banks and capital markets. Q1 earnings begin with financials, where the market will look for trading strength amid macro volatility, investment banking pipeline reacceleration and credit quality commentary, particularly whether tighter spreads are justified by fundamentals or primarily technical-driven.
This week’s data calendar includes existing home sales, Producer Price Index (PPI) and core PPI, import/export price indexes and industrial production and capacity utilization (Bloomberg, 4/13/2026).
Municipal bond update
AAA municipal yields declined again across the curve last week. Two- and five-year yields fell 10 and 11 basis points (bps), respectively, while 10- and 30-year yields were lower by 13 bps. This strong price action left these benchmarks at 2.29%, 2.53%, 2.95% and 4.31%, respectively (LSEG, 4/10/2026).
Five- to 20-year A-rated muni yields closed last week ranging from 2.71% to 4.28%, with related taxable-equivalent yields ranging from 4.58% to 7.23%, assuming a combined federal tax rate of 40.8% (Parametric, LSEG, 4/10/2026).
Muni mutual funds saw net inflows continue last week at $866 million. ETFs gained $789 million, and open-end funds added $77 million (Lipper, JPMorgan, 4/8/2026).
Tax-exempts outperformed Treasurys during the mild rally last week, with the Bloomberg Municipal Bond Index gaining 0.82%, compared with a 0.25% increase for the Bloomberg US Treasury Index. Munis are now up 0.97% year to date (YTD), compared with Treasurys being up 0.10% (Bloomberg, 4/10/2026).
Muni issuance returns to its +$10 billion weekly trend line this week, with $12.7 billion scheduled to enter the primary market (Ipreo, 4/10/2026).
Municipal Index Yield to Worst
Sources: LSEG, Parametric, 4/14/2026. 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 0.45% for the week and 0.5% month to date (MTD). The index outperformed like-duration Treasurys by 0.19% for the week and by 0.37% MTD (Bloomberg, 4/10/2026).
US investment-grade (IG) corporate yields fell across the curve last week. Two-, five- and 10-year yields decreased six, seven and five bps, respectively. Corporate yields are higher YTD, with two-, five- and 10-year yields up 32, 26 and 20 bps, respectively (Bloomberg, 4/10/2026).
IG mutual funds and ETFs experienced inflows of $597 million, a decrease from the previous week’s outflows of $1 billion. Corporate-only funds experienced inflows of $192 million, following the previous week’s outflows of $161 million (JPMorgan, 4/10/2026).
Corporate one- to 10-year IG bond yields, which have increased 28 bps YTD, ended last week at 4.8% (Bloomberg, 4/10/2026).
Corporate Index Yield to Worst
Source: Bloomberg as of 4/10/2026. 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.
Investing in fixed income securities involves risk. All investments are subject to loss. Learn more.
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