SBH Municipal Market Update
March 2023
SEGALL BRYANT & HAMILL
• www.sbhic.com
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
20
40
60
80
100
120
140
12/31/2020
1/31/2021
2/28/2021
3/31/2021
4/30/2021
5/31/2021
6/30/2021
7/31/2021
8/31/2021
9/30/2021
10/31/2021
11/30/2021
12/31/2021
1/31/2022
2/28/2022
3/31/2022
4/30/2022
5/31/2022
6/30/2022
7/31/2022
8/31/2022
9/30/2022
10/31/2022
11/30/2022
12/31/2022
1/31/2023
2/28/2023
3/31/2023
MAJOR MUNICIPAL BOND INDEX RETURNS
(%)
Municipal Market Update | March 2023
Source: All data from Bloomberg as of 3/31/23.
This update provides an overview of certain broad
-based Fixed Income benchmarks and does not include performance of the Segall B
ryant & Hamill Fixed Income styles
. Past
performance cannot guarantee future results. All investments involve risk, including the possible loss of capital.
All opinions expressed in this material are solely the opinions of Segall
Bryant & Hamill. You should not treat any opinion expressed as a specific inducement to make a particular investment or follo
w a
particular strategy, but only as an expression of the
manager’s opinions. The opinions expressed are based upon information the manager considers reliable, but completeness or acc
uracy is not warranted, and it should not be relied upon
as such. Market conditions are subject to change at any time, and no forecast can be guaranteed.
Any and all
information perceived from this material does not constitute financial,
legal, tax or other professional advice and is not intended as a substitute for consultation with a qualified professional. T
he
manager’s statements and opinions are subject to change
without notice, and Segall Bryant & Hamill is not under any obligation to update or correct any information provided in this
mat
erial.
SUMMARY
MUNICIPAL & TAX EQUIVALENT YIELDS
MUNICIPAL/TREASURY RATIOS
A & AA REVENUE CREDIT SPREADS
YTW
Duration (years)
YTD
Return
Short Duration (1
-5 Years)
2.68
2.62
1.48
Intermediate (1
-15 Years)
2.87
4.52
2.27
Long Duration (22+ Years)
4.18
10.34
4.27
30 Year AAA Muni/Treasury Ratio (%)
10 Year
3 Year
AA Muni Revenue
A Muni Revenue
Municipals had a very strong first quarter.
Their relentless move lower in yields was
initially reversed in February but resumed after
the closure of Silicon Valley Bank and
corresponding move lower in rates.
The inversion through the belly of the curve
(2-10 years) only deepened through the quarter.
Relentless buying for
SMAs
appears to be the
culprit, as buying certain maturities appear to be
prioritized over adding value.
We continue to see value in a heavier barbell
approach with sub 1 and 12+ years.
Higher dispersion between the below data points
denotes steeper curves.
Compensation for credit continues to be
significantly wider than we have seen in some time,
although it has begun to rally.
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