For a deeper dive into these trends, Franklin Templeton's 2026 Outlook and Charles Schwab's Bond Market Analysis provide comprehensive views on why intermediate-term maturities are currently favored.
Benchmark 10-year tax-exempt yields rose sharply in March, closing at 3.06% , up from 2.47% in February.
The municipal yield curve remains historically steep. Analysts at Morgan Stanley suggest that 20-year AA-rated munis offer taxable-equivalent yields of nearly 7% , significantly higher than comparable corporate bonds. should i buy municipal bond funds now
Municipal bonds generally have much lower default rates (historically ~0.03%) compared to corporate bonds (~2.5%).
Munis have a low correlation with the S&P 500 (~0.222), making them effective diversifiers when equities are at all-time highs. Key Risks to Watch For a deeper dive into these trends, Franklin
Whether you should buy municipal bond funds now depends largely on your and risk tolerance , though current April 2026 market conditions present a mix of attractive valuations and recent volatility. Market Outlook: April 2026
If you are in a low tax bracket, you may be better served by the higher yields of taxable corporate bonds. Article: The 2026 Case for Municipal Bond Funds Analysts at Morgan Stanley suggest that 20-year AA-rated
Are Tax-Free Municipal Bonds Really Worth It? Key Considerations