![]()
- White House Plans to Freeze Spending to Cut Deficit
- Week Ahead: Investors Go for Quality, Assess Recovery
- Hedge Fund Billionaire Paulson Reports New Citi Stake
- Cramer: 5 Earnings Reports to Watch Next Week
- Court Rejects 'Clawbacks' for Alleged Stanford Victims
- Cities With the Most Home Price Reductions
- Tax Credit Sparking First-Time Home Sales: Realtors
- Investors Cut Back US Stocks for Bigger Growth Abroad
- This Year's Biggest Thanksgiving Leftover: Cash
- Dollar is Not Plunging—So 'Calm Down': Market Strategist
- Strategists Say Markets Have More Upside — But How Much?
- Hirschhorn: Risk-Averse Traders
- Roginsky: A Funny Thing Happened on the Way to Financial Reform
- This Year's Biggest Thanksgiving Leftover: Cash
- TV Series Inks Unique Deal For Fight
- First Time Buyers Rescue Housing: Realtors
- Dollar General Trades Higher After Its IPO
- Fed Reform? Not So Fast.
MOST SHARED
- Today's Market Action
- Microsoft's Bill Gates Praises Apple's Steve Jobs For 'Saving the Company'
- Has Twitter's Finest Hours (Seconds) Come and Gone?
- Israel: Leader of Business Innovation
- Week Ahead: Investors Go for Quality, Assess Recovery
- Israel Going Green
- Inside Wal-Mart's Acai Berry Juice Maker
- China's Role as Lender Alters Dynamics for United States
- Seeking Innovation in Health Care
- CNBC TRANSCRIPT: Warren Buffett & Bill Gates - Keeping America Great
Treasury debt prices rose as data showing slumping home prices and dismal consumer confidence reinforced the idea that the economy is still struggling and supported a safety bid for bonds.
Investors worried about further signs of a weakening economy turned from riskier assets like stocks and bought bonds as a safe-haven investment the day before an expected Federal Reserve interest rate cut.
Data Tuesday showed a record annual decline in prices of US single-family homes in February. Another gauge showed consumer confidence fell to a five-year low in April.
"In the data today you couldn't really ask for much worse--this economy is looking very, very weak," said Dominic Konstam, head of interest rate strategy at Credit Suisse in New York.
The benchmark 10-year Treasury note rose 14/32 higher in price for a yield of 3.78 percent from 3.83 percent late Monday, while the two-year note was trading 3/32 higher in price for a yield of 2.30 percent from 2.36 percent.
The Fed begins a two-day policy meeting on Tuesday and is widely expected on Wednesday to cut its benchmark overnight rate by 25 basis points to 2.00 percent after having already cut it six times since September to stimulate the economy.
Treasury prices this week have gained on the view that the Fed may extend its rate-cutting campaign in coming months.
"People are now beginning to come around to the idea that the Fed may be pausing, but it will be a soft pause whereby they are not going to rule out further cutting," Konstam said.
For the past several weeks, bond prices had generally been falling, and yields rising, with some investors speculating that the worst of a global credit crisis may be over and that the Fed may be mulling a pause in monetary loosening after one more rate cut on Wednesday.
"Some of the higher yields of late have presented a buying opportunity to those who think the credit crisis is not over and that the economy is in recession," said Kim Rupert, managing director of global fixed-income analysis at Action Economics in San Francisco.
The Fed decision Wednesday is not the only significant information that bond investors are waiting for this week.
On Wednesday the government will release its second estimate of second quarter economic growth, to be followed by the March personal consumption expenditures (PCE) index Thursday and April non-farm payrolls Friday.
The PCE could give some indications as to the pace of inflation, while the gross domestic product and payrolls data could indicate whether the economy is firmly stuck in recessionary mode.
Soaring energy and food costs have been fueling inflation fears, which in turn has had investors speculating the Fed may be left with little room to continue loosening monetary policy to boost the struggling economy.
Five-year Treasury notes were trading 8/32 higher in price for a yield of 3.07 percent from 3.12 percent late Monday, while the 30-year bond was 27/32 higher for a yield of 4.51 percent from 4.57 percent.
- Warren Buffett and Bill Gates spoke to Columbia students, and Buffett made the students a startling offer.
- For the chief of cable company Comcast, growth has been about making deals – generally very large deals.
- Some companies may start using insurance to shift carbon risk from their balance sheets to maybe... yours?
- The president and founder of Genesis Today wants to improve America’s health, and thinks Wal-Mart can help.
- Switzerland's privacy watchdog is taking legal action to force Google to make changes to its Street View service.
- A wealthy, distracted Texas driver crashed his million-dollar Bugatti Veyron sports car into a salt marsh, say police.












