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Morningstar FundInvestor
September 2015
Bond-Market Snapshot
Interest-Rate Review
The U.S. bond market was little changed in August as most of the
action was in equities. However, emerging-markets bonds sold
off along with stocks. Slow growth in China and a possible delay in
a Fed rate hike led to a tumble in the JPM GBI Emerging Markets
Global Composite of 13.73% for the year to date. Despite poor per-
formance across most asset taxable bonds in August, the Barclays
High Yield Municipal Index gained 0.41%.
Treasury Yield Curve (
%
)
Yield to maturity of current bills, notes, and bonds
p
Current
(
08-31-15
)
p
One Year Ago
(
08-29-14
)
Treasury and Municipal-Bond Yields
High-Yield and Treasury-Bond Yields
Municipal-Bond Spread Snapshot
Unattractive
1.73
Attractive
-1.83
High-Yield Bond Spread Snapshot
Attractive
10.71
Unattractive
2.01
p
Vanguard Interm-Term Tax-Exempt
p
Vanguard Interm-Term
U.S.
Treasury
p
Vanguard High-Yield Corporate
p
Vanguard Interm-Term
U.S.
Treasury
Data as of Aug.
31, 2015
. Yield Spread: The difference between yields on differing debt instruments, calculated by deducting the
yield of one instrument from another. The higher the yield spread, the greater the difference between the yields offered by
each instrument. For municipal bonds, a smaller spread is attractive because munis typically pay smaller yields than Treasuries.
For high-yield bonds, a wider spread is more attractive because junk bonds typically pay higher yields than Treasuries.
Aug. 31, 2015
-0.34
High
1.73
Low
-1.83
Average
0.09
Last Month
(07-31-15)
-0.30
A Year Ago
(08-29-14)
-0.12
Aug. 31, 2015
4.16
High
10.71
Low
2.01
Average
3.99
Last Month
(07-31-15)
3.70
A Year Ago
(08-29-14)
2.86
08-31-15
08-31-15
7.00
6.50
5.00
4.50
3.00
1.50
0.00
15.00
12.00
9.00
6.00
3.00
0.00
98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15
98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15
Maturity
6.00
5.00
4.00
3.00
2.00
1.00
1 mo 3
6
1 yr
2
3
5
7
10
20
30