The tax-exempt market decoupled from their taxable counterparts Friday morning as selling pressure surfaced even amid a much stronger Treasury market.

Munis were weaker as Treasuries posted gains on a weaker-than-expected jobs number. July payrolls rose 162,000 and June to May payrolls were revised 26,000 lower, leaving the 12-month average gain at 189,000. The unemployment rate dipped to 7.4% from 7.6% in June due to a drop in labor force participation.

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