Market Minute

May 2023 – By Scott Rosenquist, CFA®

The U.S. Treasury announced the new rate of 4.3% for Series I bonds issued from May 1st through October 31^st of this year.  The new rate is down from the 6.89% offered previously, reflecting the decline in inflation over the past several months.  In May of 2022, the interest rate was 9.62% which generated a lot of interest from individual investors and led to incredibly high issuance of I-bonds from the Treasury.

Market Minute

October 2022 – Scott Rosenquist, CFA®

U.S. Treasury Series I Bonds will reset their interest rate next month leaving investors until the end of October to earn 9.62% for the following six months. The rate applied to I bonds is based on the month it was issued and will change every six months going forward. The current rate is attractive relative to other short-term savings options. As of now, estimates for the new interest rate appear lower than 9.62% but we will see in early November. The fixed rate component is currently zero, so the entire interest rate is based on the inflation component.

Market Minute

September 2022 – By Scott Rosenquist, CFA®

Yields across the treasury market have continued to rise this year as the Federal Reserve maintains its aggressive rate hiking plan to combat inflation.  The rise in yields has delivered negative returns for fixed income investors across the bond market, with the broad index down double digits for the year.  This dynamic has hurt broadly diversified portfolios that rely on the fixed income portion to offer ballast to equity exposure. 

Market Minute

April 2022 – Scott Rosenquist, CFA®

The bond market had its worst quarterly return in decades, down 6% as bond yields rose during the quarter and the Federal Reserve sharpened its focus on inflation. Bond prices move inversely with yields. The unemployment rate now at 3.6%, is near pre-pandemic levels but inflation continues to stay stubbornly elevated. The Federal Reserve raised interest rates by a quarter percentage point after its March meeting, the first-rate increase since 2018, and signaled six more increases for the year. As the Federal Reserve’s plans for fighting inflation became clearer, the bond market responded by quickly adjusting yields higher across the entire curve.