The tax-exempt market is expecting a smaller week of issuance with less than $5 billion coming to market.

With a lighter calendar, munis started the week on a typically slow note as traders sized up the deals and waited to see how they will be received.

"It's just quiet and people are waiting to see how it plays out," a Chicago trader said. "There is already a slight cut [in prices] outside 21 years."

The $4.98 billion expected this week is down from last week's revised $5.49 billion. On the negotiated market, $3.04 billion should be priced, down from last week's revised $4.35 billion. In competitive issues, $1.94 billion is expected to be auctioned, up from last week's revised $1.14 billion.

On Friday, munis posted losses.

Yields on the Municipal Market Data triple-A GO scale finished as much as three basis points higher. The 10-year yield increased two basis points to 1.68% and the 30-year yield rose three basis points to 2.82%. The two-year finished flat at 0.29% for the 21st session.

Yields on the Municipal Market Advisors 5% scale ended as much as four basis points higher. The 10-year and 30-year yields increased three basis points each to 1.76% and 2.98%, respectively. The two-year finished unchanged at 0.32% for the 21st session.

Treasuries were steady across the curve from Friday's levels. The benchmark 10-year and 30-year yields were flat at 1.75% and 2.96%, respectively. The two-year was steady at 0.23%.

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