BNY Mellon Short Term Municipal Bond Fund Q4 2025 Commentary

BNY Investments63 FollowersFollow5ShareSavePlay(11min)CommentsSummaryFull-year supply set another new annual record of $580 billion, up 12.9% year over year, driven in part by front-running tax policy uncertainties and higher inflation.For the quarter ended December 31, 2025, the Fund's Class I shares returned 0.45% while the Bloomberg U.S. Municipal Bond 1-3 year Index returned 0.49%.The Fund's outperformance was primarily driven by security selection, with positive contributions from education, industrial, and special tax credits.Looking ahead, 2026 is expected to be another heavy supply year driven by growing needs to fund aging infrastructure, higher cost of capital expenditure, and waning of pandemic-aid.A barbell curve posture may be favorable with exposure to short maturities while longer maturity bonds offer attractive yield in a relatively steep curve environment. ipopba/iStock via Getty Images Market Review The municipal bond market extended its rally in the fourth quarter, outperforming U.S. Treasuries and corporate bonds, supported by relatively favorable technicals and two additional 25 bp Fed rate cuts. Despite two consecutive quarters of strength, municipal bondsThis article was written byBNY Investments63 FollowersFollowBNY Investments is a global, multi-specialist asset management group, underpinned by the strength and resilience of BNY, with its 240-year history and experience. Managing nearly $2 trillion in assets, they offer investment solutions developed and managed by talented asset class specialists, each with distinct philosophies and proven approaches. Note: This account is not managed or monitored by BNY Investments, and any messages sent via Seeking Alpha will not receive a response. For inquiries or communication, please use BNY Investments' official channels.