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Treasuries, CDs, and Munis | February Rates Update

Atlanta Fed GDPNow estimate for Q1 2025 is 2.3%

New homebuilder survey declines in January … “the component measuring sales expectations in the next six months plunged 13 points to 46”

Fed Gov Waller remains in the “wait-and-see” camp watching the inflation figures.

Muni money market yields have picked up again with VMSXX 7-day yield back over 3% at 3.05%. For taxable accounts, this makes VMSXX a bit better than VMFXX in the 32% and higher federal income tax brackets.

CPI: “The all items index rose 3.0 percent for the 12 months ending January, after rising 2.9 percent over the 12 months ending December. The all items less food and energy index rose 3.3 percent over the last 12 months.”

bls.gov/news.release/pd…

Fed Chair Powell delivers the Monetary Policy Report to Congress today (2/11)

“As the economy evolves, we will adjust our policy stance in a manner that best promotes our maximum-employment and price-stability goals. If the economy remains strong and inflation does not continue to move sustainably toward 2 percent, we can maintain policy …

FOMC rate cuts continue to get pushed out further as the incoming data shows persistent inflation and low unemployment. First quarter GDPNow is 2.9% and NY-Nowcast is 3.1%.

atlantafed.org/cqer/res…

$SPX basically flat for 3 months now.

In today’s JOLTS report, the quits rate was unchanged at 2.0%

bls.gov/news.release/pd…

Vanguard announces the largest fee cut in company history: “Once again, Vanguard is lowering the cost of investing. Effective February 1, 2025, the firm reduced fees on 168 share classes across 87 funds. The fee reductions are expected to save investors more than $350 million this year alone.”

Here are the limit down circuit breaker rules per SEC: “Market-wide circuit breakers provide for cross-market trading halts during a severe market decline as measured by a single-day decrease in the S&P 500 Index.  A cross-market trading halt can be triggered at three circuit breaker thresholds—7% (Level 1), 13% (Level 2), and 20% (Level 3).  These triggers are set by the markets at point levels that are calculated daily based on the prior day’s closing price of the S&P 500 Index.

A market decl…