The municipal market was mixed overall amid short-end gains and long-end losses, following Treasuries, which moved in divergent directions after a speech by Federal Reserve Board chairman Ben S. Bernanke warning that further cuts to the federal funds rate target may be necessary.

“We started the morning with more credit concerns, and strong flight to quality,” a trader in San Francisco said. “Every single article in the Wall Street Journal was bad news for all. Then the Bernanke testimony signaled strong rate cuts for the Fed and inflationary pressures on the long end.”

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