Economic and Fixed Income Insights, March 24, 2020

Markets have calmed somewhat in the face of the pandemic caused by the coronavirus, as emergency actions continue to be taken. The Federal Reserve expanded its quantitative easing commitment regarding asset purchases, with no limits on the amount of assets to be purchased, nor a limit on how long the Federal Reserve would be purchasing them. In addition, the Senate came to an agreement for a stimulus package totaling nearly $2 trillion. Prior to these events, Treasury yields continued their downward march, with the ten-year Treasury losing 23 basis points to yield 0.85 percent, and the 30-year Treasury dropping 29 basis points to yield 1.40 percent. Lack of liquidity in the municipal market has driven benchmarks dramatically higher along the curve.  Week-over-week, ten-year MMD jumped 90 basis points while 30-year MMD rose 80 basis points.

Interest Rate Observations

Source: Thomson Reuters, Bloomberg. The table above reflects market conditions as of March 24, 2020.

Important Disclosures

This material was prepared by Stifel, Nicolaus & Company, Incorporated (“Stifel”). This material is for informational purposes only and is not an offer or solicitation to purchase or sell any security or instrument or to participate in any trading strategy discussed herein. The information contained is taken from sources believed to be reliable, but is not guaranteed by Stifel as to accuracy or completeness. Past performance is not necessarily a guide to future performance. Stifel does not provide accounting; tax or legal advice and clients are advised to consult with their accounting, tax or legal advisors prior to making any investment decision.

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