Treasurys fall as euro gains

NEW YORK (CNNMoney.com) -- Treasurys edged lower Monday as upbeat economic data from the euro zone boosted the euro, limiting the demand for safe haven assets.

What prices are doing: The benchmark 10-year note fell 8/32 to 102, pushing the yield up to 3.26% on Monday from 3.22% late Friday. Bond prices and yields move in opposite directions.

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The 30-year bond lost 21/32 to 103-6/32, yielding 4.19%. The 5-year note fell 3/32 to 100-13/32 and yielded 2.05%, while the 2-year was flat at 100-1/32, yielding 0.74%.

What's moving the market: Investors turned to riskier investments after a report showed industrial production in Europe jumped in April.

As concerns about the euro zone's debt crisis and its impact on the global economy eased, the euro climbed versus the dollar and Treasurys turned lower in early trading.

But Treasurys recovered some earlier losses as stocks ended the day mixed, following news that credit rating agency Moody's downgraded Greece's debt.

Because Treasurys are backed by the U.S. government, they are viewed as low-risk investments and are attractive during times of economic uncertainty.

Outlook: Kim Rupert, fixed-income analyst at Action Economics, said she expects Treasurys to head lower during the week if stocks manage to gain.

"A lot depends where stocks go," she said. "We kind of watch stocks day in and day out and watch the headlines to see what is going to whack stocks -- it's a treacherous trading environment."

And Rupert said Treasurys will likely continue to edge lower throughout the rest of the year, as investors become more confident in the health of the global economy.

"Markets seem to be coming around to the notion that while there's a risk to a double-dip recession, that's not the most likely scenario," said Rupert. "But of course, if stocks take a tumble, then all bets are off."