Title
Receive and Accept the Treasurer's Report of Investments for the quarter ending September 30, 2014.
Report
RECOMMENDATION:
It is recommended that the Board of Supervisors:
Receive and Accept the Treasurer's Report of Investments for the quarter ending September 30, 2014.
SUMMARY:
Government Code Section 53646 (b) (1) states the Treasurer may submit a quarterly report of investments. The attached exhibits provide a narrative portfolio review of economic and market conditions that support the investment activity during the July - September period, the investment portfolio position by investment type, a listing of historical Monterey County Treasury Pool yields versus benchmarks, and the investment portfolio by maturity range.
DISCUSSION:
During the July to September quarter, short term Treasury yields continued to move in a narrow range. Treasury yields dropped slightly in maturities of 2 years and under, and showed modest increases in the 2-5 year range. Despite minutes from the July Federal Open Market Committee meeting that suggested the Federal Reserve is in no hurry to raise interest rates, investors continue to position themselves in anticipation of the Federal Reserve raising the Fed Funds rate in the second half of 2015. In July, economic data was more positive than previous months. Second-quarter GDP expanded to a 4% annual rate (later revised to 4.6%), and July was the sixth consecutive month that reported job gains of over 200,000 per month, while jobless claims continued to fall. In August, economic activity in the U.S. continued to pick up and Consumer Confidence was reported at a seven-year high despite global economic and security concerns. September saw the positive momentum continue with Consumer Confidence continuing to climb, and employment growth at the strongest pace in 15 years.
On September 30, 2014, the Monterey County investment portfolio contained an amortized book value of $939,375,345 spread among 72 separate s...
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