Municipals crept into the holiday week with very little trading and largely unchanged yields, traders said on Monday.

"All the deals that were hot came and went last week," a New Jersey-based trader said in an interview. "This time of year people play it very close to the vest."

Issuance is expected to be nearly non-existent during the holiday week, with potential volume about $15 million, down from total sales of $2.80 billion in the week ended Dec. 20.

Traders said that yields on most bonds remained steady Monday afternoon. News that the Federal Reserve would begin tapering of its quantitative easing policy did not have a prominent impact on munis, industry analysts agreed.

"The second full day [Friday] of post-taper trading revealed just how many bets had been in place on the yield curve steepening into the FOMC announcement," Janney Capital Markets said in a report Monday.

Yields on the Municipal Market Data triple-A scale Monday were as much as a basis point higher on bonds maturing from 2019 to 2022 and from 2027 to 2043. Other bonds remained steady.

Demand for municipal bonds remains low last week, as measured by muni bond mutual fund outflows. Lipper FMI reported outflows of $1.71 billion for the week of Dec. 18, on the heels of $1.90 billion of outflows one week earlier. It was the 30th straight week the funds reported outflows.

Treasury yields rose from Friday. The benchmark 10-year yield climbed three basis points to 2.92%, while the 30-year yield gained one basis point to 3.83%. The two-year yield remained steady at 0.39% after gaining six basis points last week.

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