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The Federal Reserve is raising interest rates swiftly to slow inflation. This is creating concern for <br />some economists that rates may rise too high, too fast resulting in a deep economic downturn. <br />Treasury yields have increased across the board with the 1-year to 5-year terms seeing rates over 4%. <br />4.50% <br />4.00% <br />3.50% <br />3.00% <br />2.50% <br />2.00% <br />1.50% <br />1.00% <br />0.50% <br />0.00% <br />Treasury Yield Curve <br />1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr <br />6/30/22 <br />9/30/22 <br />Cities generally use a short -horizon benchmark such as the two-year Treasury Bill or some similar <br />measure, as of 9/30/22 the two-year T-bill was at 3.20%, up from 2.92% at 6/30/22. Our current <br />portfolio yield is roughly 4.68%. <br />Our primary reserve account is our 4M Fund which is a money market account where many cities <br />pool their funds. It currently yields 2.23% with daily withdrawal privileges. It is important the city <br />maintains a strong diversified portfolio prioritizing safety, liquidity, and flexibility in this market <br />environment. <br />Attachments <br />Investment summary <br />