Munis were little changed on Monday, as U.S. Treasuries cheapened and equities ended lower.

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Muni yields fell by up to two basis points in the belly of the curve. UST yields were three to five basis points cheaper.

The muni market was treading water on Monday, according to Ajay Thomas, head of public finance at FHN Financial. Market participants are trying to discern what Federal Reserve monetary policy will look like through the rest of the year, Thomas said, and the prevailing view is still that rates will “go up before they go down.”

The elephant in the room, Thomas said, is the U.S.-Iran war, and how negotiations about the Strait of Hormuz will affect oil prices. The markets are likely to adjust to changes in oil prices during the week, he said.

“We’re in a holding pattern right now,” Thomas said. “We’ll see some clarity with some of the inflation-related numbers coming out this week, like CPI, retail sales, and PPI, that may give a little insight as to what the Fed may be thinking as they head into the mid-September meeting.”