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In December, the City receives payments from the industrial agreements and begins to collect property tax revenues. <br />These funds are moved into the various investment pools, and later reinvested in agency notes as new issues become <br />available. At the end of the first quarter, the City’s portfolio consisted of 51% of the portfolio maturing overnight, <br />27% maturing in 1 year, 15% maturing in 1-2 years and 7% maturing beyond two years. <br />By Investment Maturity <br />7% <br />15% <br />51% <br />27% <br />Overnight1-12 Months <br />12-24 Months24-36 Months <br /> <br /> <br />Currently, the 3-month T-Bill is at 2.41%; 2-year, at 2.68%; 5-year, at 2.68%; and, the 20-year is at 2.98%. <br />Financial volatility at the conclusion of 2018 caused the yield curve to flatten with rates dropping at the long end <br />and rising at the short end of the yield curve as market uncertainty created more desirability for liquidity. <br />Yield Curve <br />4.00% <br />3.00% <br />2.00% <br />1.00% <br />0.00% <br />Treasury Bills <br />1 year ago3 months agocurrent <br /> <br />As expected the Fed increased the target rate to 2.25% to 2.50% at the December Federal Open Market Committee <br />meeting. Projections for 2019 rate increases have been scaled back from three to two as economic growth slowed <br />in the fourth quarter of 2018. Despite a drop in retail sales in December and the government shutdown, which <br />slowed economic momentum, the labor market and wages remained healthy creating optimism that the slump is <br />temporary. Staff continues to monitor rates and economic conditions, and the strategy for the portfolio will, as <br />always, focus on laddering to pick up yield along the curve and maintaining a constant cash flow and liquid position. <br /> <br /> 2 <br /> <br />