The municipal market was unchanged to slightly firmer Wednesday in light to moderate secondary trading activity as participants continued to deal with a lack of supply in the primary.

“There’s a bit of a firmer tone, but there’s not a ton of movement,” a trader in New York said. “We’re better a basis point or two in spots, if anything.”

The Municipal Market Data triple-A 10-year scale dipped one basis point Wednesday to 3.36%, the 20-year scale declined three basis points to 4.59%, and the scale for 30-year bonds fell one basis point to 4.82%.

In the daily MMD commentary, Randy Smolik questioned what it takes to produce sellers in the muni market.

“Larger dealers seemed to be on a mission to find out [Wednesday] as they kept bids tight, even made aggressive bids for select high-grade names in the 10- to 20-year range,” he wrote. “Lack of supply emboldens their conviction. The Street is still selling the view that munis should not be this cheap to Treasuries, which helped put less concern on the drift in Treasuries.”

Wednesday’s triple-A muni scale in 10 years was at 100.3% of comparable Treasuries and 30-year munis were at 107.1%, according to MMD. Meanwhile, 30-year tax-exempt triple-A general obligation bonds were at 113.9% of the comparable London Interbank Offered Rate.

Treasuries were weaker Wednesday. The benchmark 10-year note finished at 3.43% after opening at 3.33%. The 30-year bond finished at 4.60% after opening at 4.48%. The two-year note finished at 0.64% after opening at 0.61%.

The Treasury Department auctioned $35 billion of five-year notes Wednesday at a 2.041% yield and a price of 99.81. The bid-to-cover ratio was 2.97%. The Federal Reserve banks also bought $697.4 million for their own account in exchange for maturing securities.

Smolik said the secondary trading also felt like dealers were on a mission.

“The significant bumps in the triple-A curve yesterday failed to encourage a lot of sellers,” he wrote Wednesday. “Frustrated at the lack of secondary offerings and little seen in high-grade primary supply, high-grade bidders were willing to hold some bids tight to the curve.”

Trades reported Wednesday by the Municipal Securities Rulemaking Board were flat to slightly firmer. Bonds from an interdealer trade of taxable Chicago 7.781s of 2035 yielded 7.76%, two basis points lower than where they traded Tuesday. Bonds from an interdealer trade of taxable Pennsylvania Build America Bond 4.65s of 2026 yielded 5.00%, even with were they were sold Tuesday.

Bonds from an interdealer trade of taxable Texas BAB 5.517s of 2039 yielded 5.66%, down one basis point from where they were sold Tuesday. Bonds from an interdealer trade of taxable New York City Transitional Finance Authority BAB 5.717s of 2030 yielded 6.25%, two basis points lower than where they traded Tuesday.

A dealer sold to a customer California 6s of 2038 at 5.90%, even with where they were sold Tuesday. A dealer sold to a customer taxable Municipal Electric Authority of Georgia BAB 6.637s of 2057 at 6.80%, two basis points lower than where they traded Tuesday.

A dealer sold to a customer Ohio State Building Authority 5s of 2025 at 4.63%, even with where they traded Tuesday. A dealer sold to a customer Washington State 5s of 2022 at 3.95%, two basis points lower than where they were sold ­Tuesday.

A dealer bought from a customer Golden State Tobacco Securitization Corp. 4.5s of 2027 at 7.55%, even with where they were sold Tuesday. A dealer bought from a customer New York’s Metropolitan Transportation Authority 5s of 2034 at 5.33%, two basis points lower than where they traded Tuesday.

In Wednesday’s new-issue market, Citi priced $106.4 million of revenue bonds for Newport Beach, Calif.

The bonds mature from 2012 through 2021, with term bonds in 2030 and 2040. Yields range from 1.32% with a 3% coupon in 2012 to 6.07% with a 6% coupon in 2040.

The bonds, which are callable at par in 2021, are rated Aa3 by Moody’s Investors Service and AA by Standard & Poor’s.

Barclays Capital priced $49.8 million of revenue bonds for the Massachusetts Development Finance Agency on behalf of Tufts University. The bonds mature in 2036, yielding 2.70% with a 3% coupon, and are not callable. The credit is rated Aa2 by Moody’s and AA-minus by Standard & Poor’s.

The Fed affirmed its plan to purchase $600 billion of Treasury bonds through June, while holding the federal funds target rate in the zero to 0.25% range, the Federal Open Market Committee announced Wednesday.

For the first time in over a year, the FOMC decision was unanimous, breaking a string of one dissent for all the 2010 meetings.

The primary discount rate remained unchanged at 0.75%, the same rate since February 2010. The Fed has not changed the federal funds rate from its current range since December 2008.

“The FOMC is determined to maintain maximum monetary accommodation until the performance of the economy exceeds the threshold required for the pace of private-sector employment growth to pick up substantially,” Brian Bethune, chief U.S. financial economist at IHS Global Insight, wrote in a commentary.

“Indeed, we do not expect the FOMC to start the process of actively shrinking its balance sheet until late 2011 or early 2012. The next move to raise rates by the Fed is not expected until the first half of 2012,” he wrote.

In economic data released Wednesday, new home sales exceeded economist expectations in December, by jumping 17.5% to a seasonally adjusted annual rate of 329,000, but remain well below their historical norm. Economists expected 300,000 new home sales.

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