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Up-to-Date Interest Rate Curve and Tax Law Changes: What Are the Effects on the Municipal Market?  


Author:  Kjerstin Hatch.; Vikram Rai.; Thomas Doe.; John Miller.


Source: Volume 38, Number 03, Fall 2017 , pp.23-43(21)




Municipal Finance Journal

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Abstract: 

This article explores up-to-date changes and expectations for the interest rate curve and tax law. With analytical eyes on post-presidential election volatility, a distinguished panel discusses how policy changes are likely to affect the primary and secondary markets, valuations, liquidity, and buyers of municipal bonds. How might the lowering of the corporate or personal tax rates affect the different buyers of municipal bonds? How might a rise in the prevailing interest rate expose certain municipal bonds to the de minimis tax rule? What is the latest news on a potential change to the treatment of tax-exempt income? Kjerstin Hatch is managing principal and founder at Lapis Advisers, LP. Vikram Rai is head of municipal strategy at Citigroup. Thomas Doe is president and founder at Municipal Market. John Miller is co-head of fixed income at Nuveen Asset Management. This discussion is based on the authors’ presentations in the panel titled Up-to-Date Interest Rate Curve and Tax Law Changes: What Are the Effects on the Municipal Market? at the 34th Annual Conference of the National Federation of Municipal Analysts held in Washington, DC, May 16–19, 2017.

Keywords: : Interest rate curve and tax law, policy changes and markets, tax rates, municipal bonds

Affiliations:  1: Lapis Advisers; 2: Citigroup; 3: Municipal Market; 4: Nuveen Asset Management.

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