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Current Market ThemesSource: Details on market themes and economic indicators provided throughout the body of the presentation. Bloomberg Finance L.P., as of June 30, 2025.▸U.S. economy is resilient but showing signs of cooling▹Headline employment data belies underlying weakening▹Inflation remained rangebound but does not yet reflect the full impact of tariffs▹Fiscal policy uncertainty and volatile tariff rollouts weigh on consumer sentiment▸Fed remains on hold but may cut rates later this year▹The Fed’s June “dot plot” implies 50 bps of cuts in the back half of 2025 but members aresplit between 0 and 2 cuts this year▹Fed Chair Powell stated the effect, size, and duration of tariffs are all highly uncertainmaking staying on hold the appropriate thing to do as they wait to learn more▸Treasury yields whipsawed by tariff announcements in Q2▹Concerns over the budget bill, debt ceiling, and monetary policy added to volatility▹The yield curve continued to steepen between 2 years and 10 years▹Credit spreads widened sharply following tariff fears but tightened to levels near historictights by quarter endFor the Quarter Ended June 30, 2025Market UpdatePFM Asset Management | pfmam.comCITY OF REDWOOD CITY117.A. - Page 17 of 6327