The municipal market was mostly flat Wednesday amid light to moderate secondary trading activity.

“We’re pretty flat at the moment,” a trader in New York said.

“There’s not a lot trading in the secondary and there’s not much else happening the rest of the week in the primary. It’s pretty quiet.”

The Municipal Market Data triple-A 10-year scale was flat Wednesday at 2.96%, the 20-year remained unchanged at 4.26%, and the scale for 30-year bonds held at 4.70%.

Wednesday’s triple-A muni scale in 10 years was at 85.5% of comparable Treasuries and 30-year munis were at 103.3% according to MMD.

Meanwhile, 30-year tax-exempt triple-A general obligation bonds were at 108.5% of the comparable London Interbank Offered Rate.

In the daily MMD commentary, Randy Smolik wrote that “munis have been mostly focused on the very light issuance over the past several weeks.”

“But lower yield trading ranges in Treasuries have also kept muni participants fearless in pushing the belly of the serial range to new yield lows daily,” he added.

“Now, Treasuries are showing indecisiveness over inflation pressures coming down the pike,” Smolik wrote. “The turmoil in the Middle East will not go away overnight but inflation concerns may persevere, especially in light of the Beige Book report.”

The recovery continued through early February, as “modest to moderate” expansion was seen in all 12 Federal Reserve Districts, according to the Beige Book report released Wednesday.

The Treasury market was weaker Wednesday. The benchmark 10-year note was quoted near the end of the session at 3.48% after opening at 3.38%. The 30-year bond was quoted near the end of the session at 4.57% after opening at 4.48%. The two-year note was quoted near the end of the session at 0.70% after opening at 0.64%.

In the new-issue market Wednesday, First Southwest Co. priced $94.6 million of utility system revenue refunding bonds for Texas’ Tohopekaliga Water Authority.

The bonds mature from 2011 through 2032, with a term bond in 2036. Yields range from 1.07% with a 3% coupon in 2012 to 5.40% with a 5.25% coupon in 2036.

The bonds, which are callable at par in 2021, are rated Aa2 by Moody’s Investors Service and AA by Standard & Poor’s and Fitch Ratings.

Oyster Bay, N.Y., competitively sold $171 million of bonds and notes in two series.

A $61.6 million series of public improvement bonds was sold to Citi with a net interest cost of 2.34%.

The bonds mature from 2012 through 2020, with yields ranging from 1.00% with a 2% coupon in 2014 to 2.75% with a 2.625% coupon in 2020. The bonds are callable at par in 2018.

A $109.4 million series of bond anticipation notes was sold to two bidders. JPMorgan won $59.4 million with a NIC of 0.43% and Wells Fargo Securities won $50 million with a NIC of 0.41%.

The Bans mature in March 2012 with a 2% coupon and were not formally re-offered.

The economic calendar was light Wednesday.

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