After weakening Friday morning, the tax-exempt market started to regain some losses in the afternoon trading session, though traders noted activity dropped off significantly after lunch.

"I think for the day we could end flat," a Virginia trader said. "Early in the morning things were softer, and then there was weak housing data and the Treasury market took off. But the muni market after lunch is just another quiet summer Friday."

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.