Municipal Fixed Income Perspectives — May 2025

May 7, 2025 — This presentation provides an overview of our municipal market outlook and key themes, and it illustrates how Sage is positioned in the current environment.

Key Takeaways

• Tax-exempt yields remain near historic highs, and for investors at a 30% tax rate or higher, municipal bonds are outyielding most other fixed income options.
• For those that can extend duration, the long end offers attractive term premium, with the 10s30s curve offering a generous +100 bps.
• Security selection remains the area of best opportunity, while sector and credit spreads are fully valued, except for pre-paid gas bonds.