2025 Year in Review Performance Overview
The S&P Municipal Bond Investment Grade Index had a positive annual Total Return of 4.343% in 2025.
Explore key trends and performance highlights
Rate and Curve Dynamics: Front-end yields fell following Fed rate cuts, while long-end yields rose, producing pronounced curve steepening. The net curve contribution was positive
Sector and Spread: Housing benefited from spread tightening while IDR / PCR benefited from medium-length durations. Most sectors saw spread widening
Credit Quality Performance: AAA- and A-rated bonds outperformed as BBB performance was weighed down by spread widening and longer durations
State Performance: Washington and Georgia outperformed on favorable curve exposure; New York lagged due to spread widening and long-duration exposure
- Largest Credits: Port Authority of NY & NJ outperformed while New-York-specific credits underperformed with substantial spread widening
Read the full report for an in-depth understanding of the contributions to 2025’s performance.
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