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Bonds Down, Dollar Down |
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Treasury prices fall on profit taking as traders unmoved by mixed reports on income and spending.
April 29, 2005: 9:25 AM EDT
NEW YORK (CNN/Money) - Bonds fell on profit taking Friday while the dollar slipped against the euro and yen as traders digested mixed economic reports on income and spending. The benchmark 10-year note was down 11/32 of a point to 98-15/32 to yield 4.19 percent, up
from 4.16 late Thursday. The yield on the benchmark note was at about 4.20 percent ahead of
reports on personal income and employment costs. It drifted following the releases.
The 30-year bond also fell, down 5/32 of a point to 113-6/32 to yield 4.50 percent, up from 4.49
late Thursday. Bond prices and yields move in opposite directions.
The five-year note lost 9/32 of a point, yielding 3.87 percent, while the two-year note fell 5/32,
yielding 3.63 percent.
Treasurys have enjoyed a two-day rally on soft economic data and disappointing sessions for
stocks, triggering a wave of profit taking early Friday.
But a morning report from the Labor Department showing that employment costs rose a less-
than-expected 0.7 percent in the first quarter helped stem those losses.
The rise in what employers pay in wages and benefits missed forecasts for a 1 percent gain
and was the smallest increase in six years. The report helped ease worries that inflation is
increasing fast enough to compel the Fed to aggressively hike interest rates.
Bond traders fear inflation because it erodes the value of the fixed income investment.
Meanwhile, consumer spending and personal income posted stronger-than-expected gains in
March, according to the Commerce Department.
Personal income increased 0.5 percent from a revised 0.4 rise in February, versus
Briefing.com's forecast for a 0.4 percent gain.
Consumer spending gained 0.6 percent, following a revised 0.7 percent increase in February.
Economists had forecast a 0.4 percent rise in spending.
In currency markets, the dollar fell against the euro and yen.
The euro bought $1.2946, up from $1.2893 late Thursday, while the dollar bought ¥105.11,
down from ¥106.06 on the previous session.
Find this article at:
http://money.cnn.com/2005/04/29/markets/bondcenter/bonds/index.htm |
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© 2002-2008 Opportunities In Options - All Rights Reserved |
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Although this information is believed to be correct and from reliable sources, no guarantees are being made to its accuracy. Past performance is not indicative of future results. All trading involves a risk of loss.
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