The Fed’s latest 25 basis point rate cut was widely expected, but uncertainty lingers over how aggressive or conservative future policy will be. While the Fed currently projects only one cut in 2026, that could shift depending on economic data, leaving investors cautious on yield. 

This makes high yield municipal bonds an option worth considering, given their tax advantages and potential return relative to corporates. An active fund like the Invesco Rochester High Yield Municipal ETF (IROC) offers exposure with a 30-day SEC yield of 4.69% and a 12-month distribution rate of 4.43%. 

Active management is key in this space, as it allows portfolio managers to adapt holdings to evolving conditions and manage risk. 

Finsum: Taking an active approach when you can see the macro uncertainty start to creep up is a good strategy in fixed income. 

Expectations of rate cuts have weighed on the dollar, boosting international stocks and bonds and driving flows into global and emerging-markets bond funds. For investors who want both U.S. and international exposure, the Vanguard Total World Bond ETF (BNDW) offers a nearly even split between domestic and global bonds, with a low 0.05% expense ratio. 

Those who prefer a purer international allocation might look to the Vanguard Total International Bond ETF (BNDX), which focuses on investment-grade developed markets and carries just 7% emerging-markets exposure. 

Investors willing to take on more risk for higher yield can consider the Vanguard Emerging Markets Government Bond ETF (VWOB), which tracks U.S.-dollar-denominated EM government debt. VWOB’s expense ratio is higher at 0.15%, but its 30-day SEC yield of 5.88% may appeal to income seekers. 

Finsum: These funds provide tools to diversify fixed-income portfolios beyond U.S. bonds while balancing risk and return.

In his first public appearance as a Federal Reserve governor, Stephen Miran argued that Trump’s economic policies are lowering inflation and opening the door for sharper rate cuts. Miran cast the lone dissenting vote at the Fed’s recent meeting, favoring a steeper cut than the quarter-point reduction approved by his colleagues. 

He downplayed concerns that tariffs are raising consumer prices, claiming instead that foreign countries are bearing the costs—an assertion disputed by many economists. Miran confirmed he was the outlier in Fed projections, pushing for rates as low as 2.75% to 3% by year-end and promising to lay out his case in an upcoming paper. 

His dual role as both a Fed governor and member of Trump’s Council of Economic Advisors has raised questions about the central bank’s independence. 

Finsum: While Fed Chair Jerome Powell emphasized that policy will ultimately be shaped by data-driven arguments, not politics, Fed independence is at risk.