Treasurys rise after Fed buy
Prices climb as investors respond to jobs data and the Fed buys another $3 billion worth of U.S. debt.
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| Click the chart for current bond prices and yields. |
NEW YORK (CNNMoney.com) -- Treasury prices rose Thursday as investors responded to a dour reading on the job market and the Federal Reserve bought another $3 billion in U.S. debt.
Elsewhere, credit conditions eased further among banks, with a key short-term lending rate falling to a fresh record low.
The Labor Department reported a big increase in the number of people filing first time claims for unemployment benefits last week. The majority of the 32,000 new claims were due to job cuts in the automotive industry.
The jobs report came one day after the Commerce Department said that retail sales unexpectedly fell in April after a sharp decline the month before.
Despite the grim readings, stocks rose as investors regained some appetite for risk after several down sessions.
Meanwhile, the Federal Reserve bought another $3 billion worth of Treasurys after buying $9.5 billion worth in two separate purchasing operations earlier this week. The central bank bought assets maturing between October 2010 and February 2011.
The Fed has pledged to buy $300 billion in U.S. debt assets to help drive down interest rates for consumers and businesses.
Bond prices: The benchmark 10-year note was up 7/32 to 100 8/32 and its yield fell to 3.10% from 3.11%. Bond prices and yields move in opposite directions.
The 30-year bond gained 24/32 to 103 11/32 and its yield fell to 4.06% from 4.09%.
The 2-year note rose 2/32 to 100 2/32 and its yield was 0.86%.
The yield on the 3-month fell to 0.16% from 0.19%.
Lending rates: A key bank-to-bank lending rate fell to an all-time low Thursday, suggesting the credit crisis is waning for many financial institutions.
The 3-month Libor fell to 0.85% from 0.88% Wednesday, according to Bloomberg.com. Last week, the 3-month rate dropped below 1% for the first time since 1986, when the British Bankers Association started keeping records.
The overnight Libor rate held steady at 0.22%.
Libor, the London Interbank Offered Rate, is a daily average of rates that 16 different banks charge each other to lend money in London. The closely watched benchmark is used to calculate adjustable-rate mortgages. More than $350 trillion in assets are tied to Libor. 
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