The tax-exempt market continued to trade with steady yields Monday as the municipal bond market prepared itself for increased issuance expected to start pricing Tuesday.

"The market is slow and flat," a New York trader said, adding it feels like a quiet Monday. And after Thursday's downgrade by Moody's Investors Service of Puerto Rico's Sales Tax Financing Corp. bonds to A2 from Aa3, yields traded flat Monday afternoon.

One CUSIP of COFINA 5s of 2022 yielded between 4.90% and 4.923% on Monday in block-size trading.

Odd-lot trades were more volatile, this trader said. ""They are all over the place. There's a five-point range sometimes with odd-lots."

On Friday, yields on the triple-A Municipal Market Data scale were unchanged. The 10-year and 30-year yields were flat for the third session at 2.54% and 4.11%, respectively. The two-year was steady for the fourth session at 0.37%.

Yields on the Municipal Market Advisors benchmark scale were steady to one basis point higher. The 10-year yield increased one basis point to 2.70%. The 30-year yield was flat at 4.26% for the third session and the two-year closed unchanged at 0.54% for the 12th session.

Treasuries were still stronger Monday afternoon on the seventh day of the government shutdown. The benchmark 10-year and 30-year yields slid three basis points each to 2.62% and 3.70%, respectively. The two-year was steady at 0.34%.

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