NEW YORK (CNNMoney.com) - Treasury prices were mixed Friday, as investors bet that the Federal Reserve would continue to raise rates in an effort to combat inflation and as a result flattening the yield curve.

The dollar strengthened against the euro and the yen.

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The 10-year Treasury note rose 2/32 to 100-17/32 to yield 5.05 percent, down from 5.07 late Thursday.

The 30-year bond climbed 13/32 to 90-11/32, yielding 5.13 percent, down from 5.15 in the previous session. Bond prices and yields move in opposite directions.

The five-year note fell one tick to yield 4.96 percent, while the two-year note fell two ticks, yielding 4.96 percent.

With little economic data to digest, bond investors remained fixated on comments by Richmond Federal Reserve Bank President Jeffrey Lacker delivered on Thursday.

Lacker said containing inflation has to be the Fed's primary focus and that a pause in the Fed's rate-hiking campaign may be less likely.

Lacker's promise to fight inflation prompted investors to move from short-term Treasurys to longer-dated debt, narrowing the difference between the yield on the two-year and the 10-year notes.

"The remarks by Lacker [on Thursday] led to a flattening of the yield curve," William Sullivan, chief economist at JVB Financial Group told Reuters. "If the Fed goes public more frequently in the period ahead in an attempt to bolster its inflation-fighting credentials, that could lead to more flattening of the yield curve."

Treasury investors, who fear inflation since it erodes the value of the fixed-income investment, have been looking for clues about inflation pressures in an effort to determine whether the Federal Reserve will raise interest rates at its next meeting in late June.

Fed funds futures contracts have currently show a 66 percent chance of another Fed rate hike at its next meeting.

While little economic data is scheduled for early next week, investors will have plenty of reports to digest later on including new home sales for April due out Wednesday and a reading on first-quarter gross domestic product.

In currency trading, the euro bought $1.2772, down from $1.2825 on Thursday. The dollar traded at ¥111.73, up from ¥110.83 in the previous session.

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