Municipal bonds jumped on Monday, following gains in the US Treasury market after Scott Bessent was named as President-elect Donald Trump’s nominee for Treasury secretary, with traders betting the hedge fund manager will bring a Wall Street mindset to the role.
Benchmark state and local government yields fell by as much as 7 basis points as of 4:00 p.m. New York time. Tax-exempt yields on 10-year, top-rated benchmark bonds fell 5 basis points to 2.89%, according to data compiled by Bloomberg. That gauge is hovering near the lowest since late October, the data shows.
Bessent — who runs macro hedge fund Key Square Group — has called for a gradual approach to implementing trade restrictions, and has appeared open to negotiating the exact size of tariffs proposed by Trump. Treasuries traded up on the news with yields falling more than 10 basis points across five- to 30-year maturities.
Bloomberg Markets
By Aashna Shah
November 25, 2024