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ICE Fixed Income Monthly
October 2022

ICE Fixed Income Monthly

In this edition, you can watch a replay of our inaugural Fixed Income Forum which brought together industry leaders to discuss trends and challenges in the fixed income markets, as well as the innovative solutions that are driving change. We also bring you a latest report from iShares which mentions key trends they believe will propel global bond ETF growth through 2030.

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With earnings season well underway, most companies are reporting relatively solid results. I like to look to the largest banks for signs of economic distress. Despite taking significant loan loss reserves, Citigroup, Wells Fargo and JP Morgan reported an uptick in revenues in the second quarter and pointed to continued business and consumer resilience. What’s more, the labor market remains tight, suggesting that the combined effects of higher prices and tighter financial conditions have yet to fully penetrate the “demand side” of the economy.

That said, there are early signs that the Fed’s efforts to curb inflation are beginning to dampen housing market sentiment. Mortgage demand this month hit its lowest level since 1997, according to the Mortgage Bankers Association. At the same time, the monthly rate of home price declines now rivals that of the Global Financial Crisis. The ICE U.S. Conforming 30-Year Fixed Mortgage Rate Lock Loan Balance Weighted Index – a primary rate residential index that tracks where borrowers lock-in rates each day – is at 7.227, after hitting a high for the year at 7.347 earlier this month. Some think the shortfall in housing stock in the U.S. could offset these early signs of housing market weakness.

Speaking of the largest banks, Jamie Dimon remains one of my favorite CEOs to watch, in large part because he tells it like he sees it. Last week in Riyadh he reiterated his stance that the U.S. could face a recession, but he added another more complicated layer of concern to the equation: namely, that he would “…worry much more about the geopolitics of the world today.” This is a good reminder for all of us that economic and market shocks can come from anywhere.

Taken together, and perhaps unsurprisingly, these signs point to more rate hikes to come – and an ever-narrower shot at a soft landing. In fact, it’s probably time to write-off the idea altogether.

Amanda Hindlian
Amanda Hindlian
President, Fixed Income & Data Services

ICE

ICE Fixed Income Forum

We recently held the inaugural ICE Fixed Income Forum at the iconic New York Stock Exchange. The event featured best practices from industry peers on finding efficiencies and automation across the front, middle and back office, as well as discussion about the regulatory landscape and the impact of ESG on fixed income investments.

The event also included a conversation between U.S. Deputy Secretary of the Treasury, Wally Adeyemo & Josh King, Head of Communications, ICE and a fireside chat with ICE’s founder, chair and CEO, Jeff Sprecher with Amanda Hindlian, President of ICE Fixed Income & Data Services.

Replay sessions from the Forum will be available soon, in the meantime access the full recording of the day.

Watch the recording

All systems go

Bond ETFs have become fundamental to fixed income investing and now represent nearly $2 trillion in assets under management (AUM). Where do bond ETFs go from here? A recent report from BlackRock discusses four reasons why investors will continue to adopt bond ETFs on the path to $5 trillion in AUM by 2030.

Read the report

ICE Data API

Buy-side and sell-side front offices continue to embrace more data and more technology to expand their opportunities and gain an edge over the competition. Enrich your front office systems with ICE’s Data API solution, which provides intraday access to fixed income pricing, on-demand analytics, reference data and more.

Watch the video

Webinar: Handling a volatile muniverse

A growing number of municipal finance leaders are reinventing their business strategies to better manage market volatility. We recently hosted a webinar with The Bond Buyer where industry experts discussed:

  • What tools can help firms manage a volatile market
  • How to navigate challenges when finding liquidity during sell-offs
  • How automated trade strategies are impacted by market volatility

Watch the replay


Webinar: Climate indices: The new frontier in fixed income benchmarks

The European Union’s benchmark regulation (EU BMR) sets out the guidelines for Climate Transition and Paris-Aligned indices to enable investors to more easily invest toward the transition to a low carbon economy. While there are numerous climate ETFs offering exposure to equities, there is still a dearth of fixed income strategies linked to the EU’s two climate benchmark standards. Investors are looking for ways to gain passive exposure to broad fixed income indices aligned with the climate goals expressed in the Paris Agreement.

This webinar explored:

  • Why the bond market cannot be ignored in the shift to net-zero emissions
  • The importance of benchmarking against a carbon reduction index
  • The specific challenges and opportunities of fixed income indexing and how the market is set to develop over the next five years
  • ICE corporate bond climate indices

Watch the replay

Related solutions


Best Execution Service

A statistical distribution approach for measuring bond trade execution quality, our Best Execution Service utilizes ICE’s evaluated prices to help clients monitor trading activities and to help measure trading effectiveness across the growing number of venues and protocols more closely, which can assist users with meeting regulatory obligations.

Municipal Bonds

Munis are a highly fragmented market, where data can be scarce and inconsistent. The challenges created by one million active securities, over 50,000 issuers and fewer than 1% of munis trading daily mean new ways of doing business have been a long time coming. ICE’s expertise, data and technology help connect muni market participants to new opportunities.

This material contains information that is confidential and the proprietary property and/or a trade secret of Intercontinental Exchange, Inc. and/or its affiliates (the “ICE Group”), is not to be published, reproduced, copied, modified, disclosed or used in any way without the express written consent of the ICE Group. This document is provided for informational purposes only. The information contained herein is subject to change and does not constitute any form of warranty, representation, or undertaking. Nothing herein should in any way be deemed to alter the legal rights and obligations contained in agreements between the ICE Group and its respective clients relating to any of the products or services described herein. Nothing herein is intended to constitute legal, tax, accounting, or other professional advice.

The information contained herein is provided “as is” and the ICE Group makes no warranties whatsoever, either express or implied, as to merchantability, fitness for a particular purpose, or any other matter. The ICE Group makes no representation or warranty that any data or information (including but not limited to evaluated pricing) supplied to or by it are complete or free from errors, omissions, or defects. Without limiting the foregoing, in no event shall the ICE Group have any liability for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits) in connection with any use of and/or reliance on the content of this document even if advised of the possibility of such damages.

Trading and execution services are offered through ICE Bonds Securities Corporation or ICE Bonds member FINRA, MSRB, NFA and SIPC. The information found herein, has been prepared solely for informational purposes and should not be considered investment advice, is neither an offer to sell nor a solicitation of an offer to buy any financial product(s), is intended for institutional investors only and is not intended for retail customer use.[VY1]

Trading analytics available from ICE Data Pricing & Reference Data are a point in time output and as such dependent on and take into account the information available to ICE Data Pricing & Reference Data at the time of calculation. ICE Data Pricing & Reference Data does not have access to all relevant trade-related data or dealer quotes, and the utility of the output may diminish depending upon amount of available data underlying the analysis. The inputs utilized in each of the trading analytics services described herein depend on the methodologies employed by each such service and may not be the same as the inputs used in the other trading analytics services. There are many methodologies (including computer-based analytical modelling) available to calculate and determine information such as trading analytics described herein. ICE Data Pricing & Reference Data’s trading analytics may not generate results that correlate to actual outcomes, and/or actual behavior of the market, such as with regard to the purchase and sale of instruments. There may be errors or defects in ICE Data Pricing & Reference Data’s software, databases, or methodologies that may cause resultant data to be inappropriate for use for certain purposes or use cases, and/or within certain applications. Certain historical data may be subject to periodic updates over time due to recalibration processes, including, without limitation enhancement of ICE Data Pricing & Reference Data’s models and increased coverage of instruments. Although ICE Data Pricing & Reference Data may elect to update the data it uses from time to time, it has no obligation to do so.

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