With few new issues providing direction Wednesday, tax-exempts traded steady after a buying spree in the morning cooled off.

Despite lackluster trading Wednesday, munis have outperformed in recent weeks. "The 10-year Treasury is off 30 basis points in the last two weeks while the 10-year muni is only off 13 basis points," a Chicago trader said. Since the employment situation report was released May 3, the 10-year Treasury yield increased from 1.63% to 1.94% Wednesday.

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