Quarterly municipal bond outlook: Muni bonds have been resilient amid uncertainty

Municipal bonds faced a challenging first quarter of 2026, with gains exceeding 2% in January and February giving way to a rate-driven selloff in March as geopolitical risk escalated. Despite the difficult environment, taxable-equivalent yields remain near historic highs, credit spreads are attractive and fund inflows set a record — and we believe the case for municipals remains strong.

Key Takeaways

  • Despite a turbulent first quarter, the steep municipal yield curve may reward investors who extend duration, with 20-year AAA yields above 4.00%.
  • With reinvestment demand projected to surge 40% and net supply expected to remain negative, we believe technical conditions favor municipal total returns through year end.
  • Security selection in the health care and higher education sectors presents an opportunity for investors willing to look past current pressures.
Download
Related Content

Building blocks: Muni bonds construct affordable housing across America

Municipal bonds have long played an essential role in addressing America’s housing affordability crisis. As housing costs strain household budgets nationwide, municipal housing bonds may offer investors attractive tax-exempt yields while providing communities the low-cost capital needed to expand affordable housing across all income levels.

Download
Related Content

Natural capital as a shock absorber in investment portfolios

Historic volatility and uncertainty in global equity markets — driven by the escalating trade war and related inflation fears — is leading some investors to re–evaluate portfolio allocations to ensure they are well–positioned to weather the current economic environment. Of primary importance are allocations that can serve as a shock absorber within an investment portfolio, potentially mitigating overall portfolio risk and reducing the impact of market volatility.

Although optimal portfolio allocation by asset class will vary by investor, there is a common desire for portfolio diversification, stability, and downside risk management. We analyze historical performance data across a range of alternatives and traditional asset classes to evaluate how natural capital may serve these three objectives focusing on periods of high volatility and significant drawdowns.

Download
Related Content

Investing in U.S. farmland

How does direct investment in farmland provide diversification, inflation protection, and return potential?

By 2050, the world’s farmland will likely have to support a population of more than nine billion people—an increase that will require a 60% boost in agricultural productivity.  This plus converging trends including a growth in worldwide consumption of protein and resultant pressure on global grain supplies, industrialization and urban development as well as intensifying water scarcity make direct investment in U.S. farmland an increasingly compelling opportunity.

Download
Related Content

Five reasons to consider an allocation to farmland

A growing number of investors are in search of sources of stability and value to combat continued market volatility. Farmland has historically demonstrated stability, income and uncorrelated returns to some traditional asset classes, while aiming to provide resiliency in certain downturns and inflationary periods.

Download
Related Content

Top 5 reasons to consider an allocation to direct real estate

Investors today are re-evaluating risk and reward in their portfolios. Real estate can fulfill a need for stability, diversification, performance, and yield, in a world starved of income.

Download
Related Content

Questions to ask before investing in private markets

Thinking about taking the next step?

This checklist will help you consider whether the opportunity in private markets fits your goals, comfort level, and curiosity for something beyond the traditional.

Download
Related Content

Growing healthcare demand creates real estate opportunity

Why Medical Outpatient Buildings Deserve Your Attention Now

Private commercial real estate continues to mature and evolve. In recent years, investors have increased exposure to alternative sub-sectors within the asset class that offer differentiated demand drivers and the potential to outperform core real estate sectors. Healthcare real estate, which includes medical outpatient buildings (MOBs), has quickly gained investor interest, we believe for good reason.

Download
Related Content

Building wealth with private real estate

Private real estate can provide the benefits of owning real estate without the hassles that come with owning property. You have access to experienced management teams with significant resources and scale that specialize in specific property types, from data centers to industrial warehouses. They may focus on cities or regions experiencing rapid growth, or may simply look for great deals among undervalued properties. This expertise is critical as factors such as geographic location or lease structures could impact the value of each property type and in turn, the performance in your portfolio.

Download
Related Content