TRANSMITTAL LETTER FOR BOARD MEETING OF MAY 18, 2023
COMMITTEE ON FINANCE
Mr. Brian A. Perkovich, Executive Director
Title
Report on the investment interest income during March 2023
Body
Dear Sir:
Attached is a report of cash investment interest income received by the District for the month of March 2023 and a comparison of income for the same period in 2022.
The District’s inventory of investments at March 31, 2023, consisted of 232 items having a total par value of $911,075,063.46, an average annual yield of 3.57%, and total interest income to maturity of approximately $24.2 million. Inventory figures at the same date in 2022 consisted of 321 items having a total par value of $957,820,651.38, an average annual yield of 0.64%, and total interest income to maturity of approximately $15.0 million.
Interest Forecast for 2023:
On May 3, 2023, the Federal Reserve (Fed) increased interest rates by 0.25%, bringing the target federal funds rate range to 5.00-5.25%. The current target median rate for 2023 remains unchanged at 5.10%. The Fed remains highly attentive to inflation risks and seeks to achieve maximum employment along with inflation at a rate of 2% over time. It acknowledged that the U.S. banking system is sound and resilient, but tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation; the extent of these effects remains uncertain. The Fed will continue to adjust its monetary policy based on its assessment of labor market conditions, inflation pressures and expectations, and financial and international developments.
Respectfully Submitted, Mary Ann Boyle, Treasurer, MAB:eh
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