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Abstract: 

What will be the biggest driver of federal policy? What does this mean for the municipal bond market in terms of supply and demand and overall performance? Will municipal credit spreads widen with a rise in rates? As the direction of interest rates has become harder to predict, this panel discusses where rates are today compared to what had been anticipated a year ago, where they are projected to go, and what their impact is on the municipal bond market. Nick Sourbis is managing director of Fixed Income Investor Relations at National Public Finance Guarantee Corporation. Roberto Perli is a partner at Cornerstone Macro. Thomas McLoughlin is head of U.S. Fixed Income Research at UBS Financial Services. Jeffrey Burger is senior portfolio manager at Standish Mellon Asset Management. This discussion is based on the authors’ presentations in the panel on Federal Reserve Policy: Projections and Impact on the Municipal Bond Market at the 32nd Annual Conference of the National Federation of Municipal Analysts in Las Vegas, Nevada, May 12–15, 2015.

Keywords: Federal policy, municipal bond market, supply and demand, credit spreads, interest rates

Affiliations:  1: National Public Finance Guarantee Corporation; 2: Cornerstone Macro; 3: UBS Financial Services; 4: Standish Mellon Asset Management.