Wesly Pate, Portfolio Manager at Income Research + Management, spoke with Reorg about his outlook for municipal bonds in 2022. Wesly feels that the market could see a longer outflow cycle in 2022, as munis started the year below their long-term relative value averages. He also shared that he expects munis to outperform as the Federal Reserve hikes interest rates. Munis have historically outperformed in a rising-rate environment because the growing value of the tax exemptions mitigates downward price pressure, Wesly explained.
Reorg – Municipal Market 2022 Outlook: Fed Rate Hikes Wonʼt Bring Repeat of 2021 but Munis Can Still Outperform Other Fixed Income Classes
January 19, 2022
Original article by Anastasia Bergeron