The tax-exempt market was mostly quiet Monday afternoon as traders waited for the primary to provide direction and for the Federal Open Market Committee meeting later this week.

Outside one deal priced for retail on Monday, the rest of the primary was quiet. Traders were hesitant to make significant moves until the Fed announces whether it will launch Quantitative Easing 3, or not.

"It's definitely quiet out there," a New York trader said. "I'm sure between a couple of state general obligation benchmark deals this week and FOMC on Thursday everyone is patiently waiting to see some action. We need more guidance from the primary before anything serious takes place elsewhere and I think we will get the first touch of that this week."

Indeed, the primary kicked off pricing on Monday. Ramirez & Co. priced for retail $238.3 million Dormitory Authority of the State of New York lease revenue bonds for state university dormitory facilities, rated Aa2 by Moody's Investors Service and AA-minus by Standard & Poor's. Institutional pricing is expected Tuesday.

Yields ranged from 0.39% with a 3% coupon in 2014 to 3% priced at par in 2032. Credits maturing in 2013 were offered via sealed bid. Bonds maturing between 2025 and 2031 and in 2037 and 2042 were not offered for retail. The bonds are callable at par in 2022.

On Friday, the 10-year Municipal Market Data yield closed steady at 1.78% while the 30-year yield finished flat at 2.92%. The two-year closed at 0.29% for the 31st consecutive session.

Treasuries were mostly flat. The two-year was steady at 0.26% while the 30-year was flat at 2.83%. The benchmark 10-year yield increased one basis point to 1.68%.

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