The tax-exempt market focused on the Illinois auction in the competitive market while traders said outside that big deal, the rest of the market was quiet.

All eyes were on $800 million Illinois general obligation bonds – auctioned in two pricings – rated A2 by Moody's Investors Service, A-minus by Standard & Poor's, and A by Fitch Ratings.

Bank of America Merrill Lynch won the bid for $450 million of tax-exempts. Credits maturing between 2025 and 2034 were insured by Assured Guaranty Mutual and were rated A2 by Moody's and AA-minus by Standard & Poor's.

Yields ranged from 0.88% with a 2% coupon in 2014 to 4.44% with a 5% coupon in 2038. The bonds are callable at par in 2023.

"The deal priced well," a Markit analyst said, adding 10-year Illinois GOs were evaluated at 150 basis points above Markit's internal triple-A benchmark and the deal came in at 141 basis points over.

B of A Merrill also won the bid for $350 million of taxable GOs. The bonds were priced at par with coupons ranging from 1.1% in 2014 to 5.52% in 2038.

"It looks like it was priced right," a Chicago trader said. "My guess is they wouldn't have gone to market if they didn't see decent demand."

Outside Illinois, the market was quiet. "The rest of the market is hitting the snooze button," the Chicago trader said. He said there are still some spring vacations this week so the market has no continuity.

"It's close to tax time and people are scrambling," he said. Still, while March was a tough time for the muni market, April should bode better. "There are too many bonds in March and not enough place to put them. Now it needs to be worked through. April is a low issuance month and is able to absorb what is left over from March. And that's the case again this year."

In the rest of the primary Tuesday, other mid-sized deals were priced. Barclays priced and repriced $380.8 million of Golden State Tobacco Securitization Corp. enhanced tobacco settlement asset-backed bonds, rated A2 by Moody's, A-minus by Standard & Poor's, and BBB-plus by Fitch.

Yields ranged from 1.09% with 3% and 5% coupons in a split 2017 maturity to 4% coupon priced at par and 3.70% with a 5% coupon in a split 2030 maturity. Yields were lowered as much as eight basis points from preliminary pricing. The bonds are callable at par in 2023.

On Monday, municipal bond scales ended as much as two basis points stronger.

Yields on the Municipal Market Data triple-A GO scale ended as much as two basis points lower. The 10-year yield dropped two basis points to 1.89%. The 30-year yield held steady at 3.09% for the third session and the two-year finished flat at 0.31% for the 29th consecutive session.

Yields on the Municipal Market Advisors 5% coupon triple-A benchmark scale also ended as much as two basis points lower. The 10-year yield slid two basis points to 1.94% and the 30-year yield fell one basis point to 3.18%. The two-year held at 0.33% for the 24th session.

Treasuries were still weaker Tuesday afternoon. The benchmark 10-year yield and the 30-year yield rose two basis points each to 1.86% and 3.10%, respectively. The two-year yield increased one basis point to 0.25%.

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