Inflation data humbled the markets yesterday, and municipals gave back Tuesday's gains of 1/4 to 3/8 point, forcing underwriters to adjust new-issue yields by about five basis pints.

The producer price index for finished goods jumped 0.7% in October, its largest monthly advance in a year and far higher than the 0.1% the markets had expected. Treasury prices plummeted as much as 1 3/8 point in shock, but tax-exempts lagged once again.

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