Market Insights

Investors continue to add funds to MUNI bond funds; last week, 260MM was added from retail investors. The prior week saw a 262MM inflow, indicating that retail investors have been seeking tax-exempt paper over the past few months. The overall calendar continues to...

• We have continued to report on fund flows – investors added 253MM to MUNI funds in the week ended 12/3/25, the previous week saw 217MM inflow, according to the Investment Company Institute.

We have been discussing higher education as well as health care for quite a while. The Trump administration said it will transfer some of the Education Department’s most extensive grant programs and major portions of several offices to other federal agencies, part of a broader plan to reduce the department’s authority significantly.

Fed Reserve Bank of SF President Mary Daly indicated further rate cuts are likely needed, but the US central bank should approach those cuts with caution.

• Chicago is lending cash to its underfunded pensions so they have enough money to avoid asset sales to cover retirement checks as they wait for property taxes to come in after a computer issue delayed collections.

• Connecticut is collecting a duo of fiscal wins this week with two upgrades from both Moody’s and Fitch. Both of the credit rating agencies cited improvements in the state’s budget management practices.

• As mentioned in a previous note, we have several economic data points being released BEFORE the FED meeting this month. One of which is the Non-Farm Payrolls, Bloomberg is expecting a larger gain in August’s numbers than in July.

• Articles are surfacing about the unprecedented and escalating attacks on the FED from President Trump. The attacks could backfire by hitting financial markets and the economy with higher long-term borrowing costs.

With Jackson Hole this week, we are seeing a lot of news regarding the FED. Most FED officials highlighted inflation risks as outweighing concerns over the labor market at their meeting last month.