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Bonds offer mixed results
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January 28, 2002: 3:20 p.m. ET
Treasurys muted ahead of FOMC meeting; dollar gains against euro, yen
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NEW YORK (CNN/Money) - U.S. Treasurys were mixed Monday after a week-long selloff as investors preferred to play the waiting game ahead of the mid-week Federal Reserve policy meeting, at which officials are expected to keep interest rates steady.
At 3:00 p.m. ET, two-year notes were flat at 99-21/32, yielding 3.18 percent. Five-year notes were down 2/32 at 96-2/32 to yield 4.42 percent.
Benchmark 10-year notes were down 2/32 at 99-13/32, yielding 5.08 percent, and 30-year bonds were down 2/32 at 98-20/32, yielding 5.47 percent.
"It's been fairly quiet and we haven't seen a lot of buying; the market is getting positioned for the Fed on Wednesday," said John Spinello, fixed-income strategist at Merrill Lynch Government Securities.
Spinello the Commerce Department's report that home sales jumped in December -- a sign of stronger economic activity that could have been detrimental to bonds -- provoked no fresh selling.
"The home sales data were on the firm side and yet we didn't see any selling when they came out," Spinello said. "We had come close to the low (prices) of Friday's session and couldn't go lower, so that caused a bit of short-covering."
"That's been an area where people perceive value," Spinello added.
The vast majority of Wall Street bond dealers believe the Fed is finished cutting the key federal funds overnight bank lending rate, but will not begin boosting it again until at least the second half of the year.
The Fed has cut its benchmark federal funds rate 11 times since January 2001 to a 40-year low of 1.75 percent.
Dollar leads against euro, yen
In the currency market, the euro pulled back from an earlier six-month low against the dollar, while the greenback dipped against the yen.
At 3:00 p.m. ET, the euro was quoted at 86.14 U.S. cents, down from 86.41cents Friday.
The dollar bought ¥133.44, down from ¥134.87 Friday. 
-- from staff and wire reports
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