Treasury prices climbed for a third straight trading day Monday, boosted by end-of-the-quarter demand.
The increase pushed Treasurys yields lower, which is good news for homeowners and those looking to buy a home. Long-term Treasury yields are closely tied to interest rates on mortgages and other consumer loans, which have been rising in recent weeks. Investors have been worried that a spike in rates could dampen an economic recovery.
In afternoon trading, the yield on the benchmark 10-year Treasury note fell to 3.49 percent from 3.53 percent late Friday.
Tom di Galoma, head of fixed-income trading at Guggenheim Capital Markets LLC, said the gain was likely due to "window-dressing" by investors looking to bolster returns as the April-June quarter comes to a close on Tuesday.
Portfolio managers "want to show they have some assets on the book," he said.
Treasurys, which rose along with the stock market on Monday, extended an advance that began at the end of last week following a spate of solid auctions. A lack of new supply coming into the market this week is likely adding to Treasurys' gains.
Earlier this month, yields on long-term Treasurys spiked to their highest levels of the year amid growing concerns that the flood of government debt coming to the market would be met with weak demand. But auctions have gone relatively smoothly so far this year, helping to ease some of those fears.
Later this week, investors will look to a handful of key reports _ particularly the monthly employment report on Thursday _ for more direction on the economy. Investors tend to flock to Treasurys for safety when worried about the economy's health.
As the Dow Jones industrials gained nearly 70 points in afternoon trading, the 10-year Treasury note's price was up 14/32 at 96 31/32.
The 30-year bond's yield was down to 4.29 percent from 4.34 percent. Its price rose 25/32 to 99 10/32.
The two-year note's yield slipped to 1.11 percent from 1.12 percent, and its price rose about 1/32 to 100 1/32.