Federal Reserve Bank of Dallas

ICI's report marks the 12th consecutive week of inflows bringing the total for 2021 to more than $40 billion. Lower- and non-rated deals saw 20 to 30 basis point bumps in repricings as any paper with yield is massively oversubscribed.

Signs of excess risk taking in financial markets show it’s time for the U.S. central bank to start debating a reduction in its massive bond purchases, said the president of the Dallas Federal Reserve, breaking ranks with Chair Jerome Powell.

Municipals continue to outperform Treasuries amid a light holiday-shortened week led by a California tobacco deal.

Dallas Federal Reserve President Robert Kaplan said he is among policy makers estimating that the central bank will have to raise interest rates next year.

Bouts of higher inflation won’t be surprising and while they’ll likely be transitory, it’ll be something to watch closely, said Federal Reserve Bank of Dallas President Robert Kaplan.

The policy-setting Federal Open Market Committee repeated earlier this week that it would continue to make asset purchases of at least $120 billion every month until “substantial further progress” had been made toward its employment and inflation goals.

Federal Reserve officials said that more fiscal support and the mass distribution of vaccines could lead to a strong U.S. economic recovery in the second half, setting the stage for a discussion of potential tapering of bond buying before year’s end.

Federal Reserve officials shouldn’t intervene to slow rising bond yields because that is expected to happen as the U.S. economy recovers, said Federal Reserve Bank of Dallas President Robert Kaplan.

The housing market continues to shine, showcased by the S&P CoreLogic Case-Shiller national index, which climbed 1.4% in October from a month earlier. On an annual basis the national index jumped 8.4% in October, compared with 7.0% in September.

With sparse economic data available, market participants will likely be focused on news from Washington and the continued effects of COVID-19, according to the economists at Deutsche Bank.