Bond prices fell Friday, pushing their yields
higher, as hopes diminished for another interest rate cut soon.
The price of the benchmark 10-year Treasury note fell 17/32
point, or $5.31 per $1,000 in face value. Its yield, which moves in
the opposite direction, rose to 5.15 percent compared with 5.07
percent late Thursday.
The 30-year Treasury bond fell 23/32 point to yield 5.51
percent, up from 5.44 percent a day earlier, according to Bridge
Telerate news service.
Treasuries had rallied after the Federal Reserve cut interest
rates Wednesday, but with its next meeting not scheduled until
March 20, hopes were fading that the Fed would make another
dramatic move before then to cut rates, as it did in the early days
of this year.
In other trading, short-term Treasury securities fell between
3/16 point to 7/32 point, while intermediate maturities fell
between 13/32 point and 7/16 point.
Yields on three-month Treasury bills were 5.04 percent as the
discount rose 0.06 percentage point to 4.92 percent. Six-month
yields were 4.89 percent, as the discount rose 0.07 percentage
point to 4.72 percent. One-year yields were 4.68 percent as the
discount roseby 0.11 percentage point from late Thursday to 4.49
Yields are the interest bonds pay by maturity, while the
discount is the interest at which they are sold.
The federal funds rate, the interest on overnight loans between
banks, fell to 5.50 percent from 5.63 percent late Thursday.
In the tax-exempt market, the Bond Buyer index of 40 actively
traded municipal bonds fell 3/32 to 104 3/32. The average yield to
maturity was unchanged at 5.39 percent.