Monthly Market Monitor

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The second estimate of first quarter 2024 real GDP growth was revised lower to an annualized rate of 1.3%. While this marks the slowest growth rate in almost two years, excluding the impacts of trade, inventory and government spending, underlying domestic demand appears strong and remains consistent with recent quarters.

Minutes from the May 1 Federal Open Market Committee meeting acknowledged the lack of progress on inflation during the first quarter. Additionally, the minutes indicated that while current monetary policy is restrictive, members were uncertain regarding the degree of restrictiveness. Their uncertainty was reflected in discussions about whether the economy is less sensitive to interest rates than in prior business cycles; the neutral, long-run fed funds rate is higher than previously believed; and/or potential economic output could be lower than previously thought.


May new issuance exceeded expectations, closing the month with slightly more than $130 billion in new supply. Forecasted issuance for June approximates $90 billion, which, if accurate, would represent the slowest monthly pace of the year.

Primary market issuance was dominated by smaller deals, unlike earlier in 2024, when there were several large, acquisition-related financings.

Credit spreads compressed an additional 2 basis points during May; valuations remain quite expensive on a historical basis.


The asset-backed securities sector continued its year-to-date streak of positive excess returns. Despite further spread compression, valuations remain favorable.

Mortgage-backed securities performed well during May, outpacing other investment-grade sectors, after underperforming for much of the year.

Chart of the Month: ICI Taxable Bond Long-Term Mutual Fund and ETF Weekly Flows, ($ millions)

ICI Taxable Bond Long-Term Mutual
Fund and ETF Weekly Flows, ($ millions)

  • Year to date, taxable fixed income products have experienced persistent inflows.
  • Robust investor demand for the fixed income sector has manifested a strong technical tailwind and contributed to tightening risk premiums.

As of 5/22/2024. Source: Bloomberg L.P., ICI (used with permission). 

Market Data

Market Data

As of 5/31/2024. Source: Bloomberg L.P.

Bloomberg Sector/Index Performance (USD)

Bloomberg Sector/Index Performance (USD)

As of 5/31/2024. Source: Bloomberg L.P.

Important Disclosures

This publication is for informational purposes only. Information contained herein is believed to be accurate, but has not been verified and cannot be guaranteed. Opinions represented are not intended as an offer or solicitation with respect to the purchase or sale of any security and are subject to change without notice. Statements in this material should not be considered investment advice or a forecast or guarantee of future results. To the extent specific securities are referenced herein, they have been selected on an objective basis to illustrate the views expressed in the commentary. Such references do not include all material information about such securities, including risks, and are not intended to be recommendations to take any action with respect to such securities. The securities identified do not represent all of the securities purchased, sold or recommended and it should not be assumed that any listed securities were or will prove to be profitable. Past performance is no guarantee of future results.

Indices and/or Benchmarks Definitions

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