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Bonds higher on big-ticket item softness Durable goods orders jump but fall short of expectations; dollar weakens. NEW YORK (CNNMoney.com) -- Bond prices climbed Thursday after a robust report on durable goods revealed it fell short of expectations when the transportation component was stripped out. The dollar slipped against the euro and the yen.
The benchmark 10-year note rose 12/32, or $3.75 on a $1,000 note, to yield 4.72 percent, down from 4.76 percent late Wednesday. The 30-year climbed 22/32, or $6.87 on a $1,000 note, to yield 4.84 percent, down from 4.88 the previous session. Bond prices and yields move in opposite directions. The five-year note rose 8/32 to yield 4.69 percent, while the two-year note added 3/32 to yield 4.80 percent. Treasury prices ticked higher after the Commerce Department reported that durable goods order jumped 7.8 percent in September, its biggest jump in over 6 years, helped by nondefense aircraft and parts orders. Orders for the big-ticket items was forecast to be up 2.3 percent after being unchanged in August. But excluding transportation, orders rose a modest 0.1 percent, versus expectations for a 1.0 percent gain, sending Treasurys higher. Bond traders however, were still mulling over the Federal Reserve's decision to leave short-term U.S. interest rates at 5.25 percent for a third straight month. In its statement, the Fed noted again that the economy has slowed, but the central bank also indicated it's still wary of inflation, although it removed commodity prices as a source of that inflation. Inflation hurts bonds as it erodes the value of the fixed interest-paying investment. In currency trading, the euro bought $1.2658, up from $1.2610 late Wednesday. The dollar bought ¥118.74, down from ¥119.02 the previous session. -- from staff and wire reports |
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