The municipal market was firmer yesterday, following Treasury gains. Traders said tax-exempt yields were lower by two to four basis points overall.

"There's a lot of movement on the short end. We're pretty sizably firmer there, inside of two years," a trader in New York said. "You're probably seeing gains of up to eight basis points that short. But the gains get smaller and smaller as you go out the curve, until they're practically nil out really long. Overall though, I think it's fair to call it around three basis points better."

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