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Current Market Themes <br />Source: Details on market themes and economic indicators provided throughout the body of the presentation. Bloomberg Finance L.P., as of December 31, 2025. <br />▸U.S. economy remains resilient but government shutdown obscures data <br />▹Inflation print likely biased lower due to data collection gaps and technical adjustments <br />▹Unemployment rate trends higher with net new job creation near zero <br />▹Strong consumer and business spending, along with steadier trade dynamics, support growth <br />▸The Fed lowered the target rate by 50 basis points in the fourth quarter to 3.50-3.75% <br />▹Fed Chair Powell acknowledged ongoing challenges in achieving the Fed’s dual mandate of <br />maximum employment and price stability <br />▹The Fed’s December “dot plot” indicates 25 bps of cuts in both 2026 and 2027, but the wide <br />dispersion in underlying projections highlights differing views on path forward <br />▹Markets view policy is skewed towards additional easing assuming a more dovish Chair takes <br />office in mid-2026 <br />▸Treasury yield curve continues to steepen but remains inverted inside 2 years <br />▹Front end Treasury yields moved lower during the fourth quarter on Fed rate cut expectations <br />▹Yields were range bound as volatility waned into year end <br />▹Credit spreads widened marginally but remain near historically narrow levels <br />City of San Leandro <br />For the Quarter Ended December 31, 2025 <br />Market Update <br />PFM Asset Management | pfmam.com 3 <br />Exhibit A <br />Resolution No. 2026-060