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Treasurys rise on more negative economic data

Treasurys rise on more negative economic data

Treasury prices rose Tuesday as a disappointing report on consumer confidence sent investors again searching for the safety of government debt.
The Conference Board reported that its Consumer Confidence Index fell to an all-time low of 38 during December, stirring more questions about the economy's ability to recover. Although the report didn't deter investors from buying stocks, they were also hedging their bets by parking money in less risky fixed-income securities.
Treasurys have enjoyed a run during the past year as investors sought out the relative safety of government issues to protect assets threatened by the credit crisis. In fact, yields dropped so significantly in 2008 that some shorter-term debt reaped almost no return.
The market's movements on Tuesday were muted due to low trading levels because of the holiday-shortened week.
In late trading, the two-year Treasury note rose 3/32 to 100 9/32 and its yield slipped to 0.73 percent from 0.78 percent late Monday.
The 10-year Treasury note rose 14/32 to 115 and its yield fell to 2.06 percent from 2.10 percent. The 30-year Treasury bond rose to 1 30/32 to 139.03 27/32 and its yield fell to 2.59 percent from 2.64 percent.
The three-month Treasury bill's yield was up to 0.06 percent from 0.03 percent on Friday. Higher yields indicate lower demand. Its discount rate was 0.04 percent. Investors this year have been willing to stash their money in T-bills with little or no returns because their principal will remain intact.
Meanwhile, the cost of short-term dollar loans between banks eased further on Tuesday, with three-month dollar loans at 1.435 percent.
The Libor _ or London Interbank Offered Rate _ was down from 1.459 percent, or a little more than 0.02 percentage point.
Short term rates have fallen in response to central bank actions cutting their base interest rates, but remain well above those base rates _ a sign of the stress on the financial system from the recession and losses that banks have suffered this year.
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AP Business Writer David McHugh contributed to this story from London.


Updated : 2021-06-24 04:36 GMT+08:00