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The Fed chairman said he believes the Fed is getting close to a sufficiently restrictive level, but they're not quite there. While two good inflation reports are good, "there's still a long way to go to price stability."

Munis saw the best performance in November in decades, with the asset class ending in the positive by 4.68%. The MSRB reported that trading volume reached another record in November, with 1.29 million municipal trades.

Powell said smaller interest rate increases are likely ahead — and could start as early as next month.

Federal Reserve Bank of St. Louis President James Bullard urged policymakers to raise interest rates further, saying the level will need to be higher to meet the central bank's goal to be "sufficiently restrictive" to bring down inflation.

"It will take time for the full effect of tighter financial conditions to work through different sectors and to bring inflation down," Brainard said. "Monetary policy will need to be restrictive for some time to have confidence that inflation is moving back to target."

Federal Reserve Chair Jerome Powell has deflected requests from a top critic, Sen. Elizabeth Warren, for details of financial transactions by central bank officials, risking an escalation of tensions with lawmakers over disclosure issues.

Munis were little changed while long UST improved and equities ended in the red after the FOMC raised the fed funds rate target 75bps to a range of 3% to 3.25% and members are leaning toward a rate of 4.4% by yearend.

"The Fed is going to need great skill and also some good luck to achieve what we sometimes call a soft landing," Yellen said.

"We need to act now, forthrightly, strongly as we have been doing," Powell said Thursday in remarks at the Cato Institute's monetary policy conference.

The Investment Company Institute reported $755 million of outflows from muni bond mutual funds in the week ending August 24 compared to $320 million of inflows the previous week.

Federal Reserve officials, picking up where they left off over the weekend in Jackson Hole, stressed their commitment to defeating inflation while remaining vague on how big their policy move will be next month.

Investors will be greeted Monday with decreased supply with the new-issue calendar estimated at $5.882 billion, down from total sales of $6.134 billion in the week of Aug. 22.

Outflows from municipal bond mutual funds continued as investors pulled $1.180 billion out of funds in the latest week, according to Refinitiv Lipper data.

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.

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.

The Federal Reserve’s Inspector General said Chair Jerome Powell and former Vice Chair Richard Clarida’s trading activity had not broken any laws or rules, but the probe into the former heads of the Dallas and Boston regional Fed banks remained open.

Federal Reserve Chair Jerome Powell said the U.S. economy is in “strong shape” and the central bank can reduce inflation to 2% while maintaining a solid labor market.

Federal Reserve officials will discuss whether to raise rates by 50 basis points or 75 basis points when they meet next month, with the decision being determined by economic data, New York Fed President John Williams said on Tuesday.

Federal Reserve Bank of St. Louis President James Bullard said fears of a U.S. recession are overblown.

Natalie Cohen of The Public Purse and John Mousseau of Cumberland Advisors take a deep dive into what’s happening in Reedy Creek in the wake of the Florida battle between Gov. Ron DeSantis and the Disney Co. Is it a portent of things to come or just a tempest in a teapot? Chip Barnett hosts the podcast recorded June 9. (33 minutes)