January 2026 Performance Overview
The S&P Municipal Bond Investment Grade Index increased by 0.728%, as income was bolstered by falling yields in the front half of the yield curve.
Other Highlights
- Muni Momentum: January was the sixth month in a row with a positive return, bringing the index’s six-month trailing return to 5.434%
- Rates and Curve Dynamics: Declining short- and intermediate-term yields supported returns, while higher long-term yields led to continued curve steepening
- Sector and Spread: Overall sector and quality effects were positive, led by spread tightening in Other Utility, Transportation, and State GO sectors with widening in Tobacco Settlement, Prerefunded/ETM, and IDR/PCR bonds
- State Performance: New Jersey outperformed due to tightening spreads in its Transportation sector, while Michigan, Pennsylvania, and Ohio lagged amid broad-based spread widening across sectors
Read the full report for an in-depth understanding of the contributions to the month’s performance as well as a “2025 Year in Review” summary.
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