Economic indicators

While municipals were little changed, broader markets remain focused on Jackson Hole and speculating what will be said about tapering.

U.S. Treasuries gave little direction Monday, holding ratios and yields steady, leading most participants to argue both are satisfactory to ride out the summer.

The short end of the muni market saw trading of larger blocks at or below benchmarks but yield curves were little changed on a summer Friday.

Refinitiv Lipper reported $1.87 billion inflows. A solid demand component for the market, but some suggest the move into bonds from equities is more an asset reallocation than investors keen on fixed income.

Another $2 billion-plus was reported flowing into municipal bond mutual funds in the latest week, continuing to be a supportive demand component for munis.

Municipals are tethered to Treasuries, more so in recent sessions, and have cheapened, but strong technicals — $18.5 billion of net negative supply and large reinvestment needs — still hang overhead.

Triple-A benchmarks saw cuts of one to two basis points across the curve, but still outperformed two days of UST weakness and have outperformed UST losses since the start of the month.

Better-than-expected job gains, a rising UST complex and an increase in supply to test municipals' resolve.

Secondary trading petered off into Thursday afternoon, holding triple-A benchmarks steady as most participants await Friday's nonfarm payrolls.

The short end of the market has little room to fall lower.