FOMC

The Federal Reserve is committed to cooling inflation and needs to raise interest rates to a little above 4% to ease demand, Cleveland Federal Reserve Bank President Loretta Mester said.

The Investment Company Institute reported investors pulled $246 million out of muni bond mutual funds in the week ending July 27 compared to the $602 million of outflows in the previous week.

St. Louis Fed Bank President James Bullard said he favors a strategy of "front-loading" big interest-rate hikes, and he wants to end the year at 3.75% to 4%, while his Richmond counterpart, Thomas Barkin, said the central bank was committed to lowering inflation and a recession could happen.

Federal Reserve officials said they want strong evidence that the hottest inflation in four decades is on a sustainable downward path before declaring victory in their fight against it.

The day after the Federal Open Market Committee's next meeting we will analyze the increase and the signals about what rate hikes may be coming.

The large primary was led by two $700-plus million of revenue bonds from the Port of Seattle and the Georgia Ports Authority.

Federal Reserve Bank of Minneapolis President Neel Kashkari said the central bank is committed to doing what’s necessary to bring down demand in order to reach policy makers’ 2% long-term inflation goal, a target that remains far off.

Municipals will end July with positive returns across all sectors. The Bloomberg Municipal Index shows a 2.49% return in July, moving year-to-date losses lower to 6.71%.

Total July volume was $25.598 billion in 520 deals versus $37.573 billion in 1,013 issues a year earlier, according to Refinitiv data.

Former Treasury Secretary Lawrence Summers said he was concerned the Federal Reserve is still engaging in “wishful thinking” about how much it will take to bring inflation down from four-decade highs.