Municipal prices held up well in a quiet session Monday, but most market players were idle, waiting for a number of economic reports slated for release this week.

Today's release of the leading economic indicators for June could give the market a push and Friday's employment figures for July are expected to have an even larger impact, traders said.

Yesterday's resilient undercurrent lifted prices slightly in the futures market. The September municipal contract finished up 1/32 to 101.11

As the municipal market outperformed the taxable market, the MOB spread contracted 4 basis points to minus 450 from minus 454 on Friday.

In late action in the cash market, PICA MBIA 5 5/8s of 2023 were quoted at 5.80% bid, 5.78% offered, with yields up about 2 basis points from Friday. New York LGAC 5 1/2s of 2018 were quoted at 5.80% bid, 5.78% offered, with yields down 1 basis point from Friday. Salt River 5 1/4s of 2019 were quoted at 5.72% bid, 5.68% offered, unchanged from Friday.

In short-term note trading, yields were down slightly in quiet trading, ahead of New York's $1.1 billion issue of revenue anticipation notes expected sometime this week.

California RANS were quoted at 2.98% bid, 2.94% offered, down 2 basis points from Friday. Los Angeles notes were quoted at 2.95% bid, 2.92% offered, down 5 basis points. Wisconsin notes were quoted at 2.96% bid, 2.93% offered, down 4 basis points.

"We think the short-end is very attractive right now," one portfolio manager said. "With Treasuries in the area of 3.20% and munis around 3%, that looks historically cheap to us."

Traders said they saw three or four lists of bonds being circulated by institutional investors seeking bids, but no major trades were completed.

The taxable market was weaker than the municipal market, with the September Treasury bond contract finishing down 3/32 to 115.13.

The intermediate sector finished weakest, with the Treasury's ten-year note off about 1/4 in late trading. The short-end was also weak, with yields rising 3 to 4 basis points.

The primary, long-term sector was very quiet, with no major deals. The slowdown in new issuance has given firms time to unload pent up inventory.

First Boston priced a $305 million issue of variable rate bonds for New York City. The twenty-two to thirty-year bonds will be backed by letters of credit from seven banks.

Yields on the deal varied based on the credit strength of the LOC providers.

The $50 million of bonds backed by a letter from triple-A rated Morgan Guaranty Trust Co. was priced to yield 2.55% and the remainder of the deal was priced at 2.60%, according to a city official. The rate on the securities will be reset daily, according to the official.

Some of the LOCS cover only the first three years of the deal and some cover the first five years. But the banks must tell the City if they plan to renew each letters one year before each letter expires.

If the letters are not renewed and cannot be replaced, city officials said they could convert the bonds to a ftxed-rate or refund some bonds.

Dealers saw some slight easing of secondary market supply yesterday. The Blue List, a measure of dealers' inventory, dipped below the $2 billion mark, to $1.9 billion yesterday. The list had been over $2 billion for seven consecutive sessions for the first time since 1987.

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