Despite lawmakers' calls to expand the program, there is a strong indication the Federal Reserve's short-term note purchase program is working as intended and does not need to be changed so long as the municipal market stays stable. More than 50 members of Congress recently wrote a letter to Fed Chair Jerome Powell urging him to expand the $500 billion Municipal Liquidity Facility to make more municipalities eligible, extend the maturity period for those bonds and change the bond rates to be more favorable. "The Fed was empowered during the crisis to make sure the markets had clearing levels and that there was liquidity and by that definition, the MLF is doing exactly what it's supposed to," said Brian Battle, director of trading at Performance Trust Capital Partners.
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