NEW YORK (CNNMoney.com) -- Treasury prices continued to surge Tuesday, pushing the 2-year note's yield to a record low and the 10-year note's yield below 3% for the first time since April 2009, as the looming expiration of Europe's bank lending program boosted demand for the safety of government debt.
What prices are doing: The benchmark 10-year note jumped 19/32 to 104-21/32 and its yield sank to 2.96% from 3.03% on Monday. Bond prices and yields move in opposite directions.
The 30-year bond climbed 1-10/32 to 107-26/32 with a yield of 3.93%. The 2-year note gained 2/32 to 100-2/32 and its yield was 0.61%. Earlier, the 2-year note's yield fell to 0.59%, a record low.
What's moving the market: The European Central Bank's year-long lending program to boost liquidity expires Thursday. As banks in the euro zone gear up to pay back €442 billion, investors are nervous that end of the program could further rock the financial system.
Because Treasurys are backed by the U.S. government, they are viewed as low-risk investments and are attractive during times of economic uncertainty.
What analysts are saying: "Treasury rates this low typically signal a real slowdown in economic activity, or even a recession," said Peter Cardillo, chief market strategist at Avalon Partners. "But I think this is a heightened fear factor and a flight to quality as opposed to any real economic meltdown."
He added that investors are concerned that when banks pay back the loans, the market will face another credit crunch.
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||4.40%||4.29%|
|15 yr fixed||3.81%||3.72%|
|30 yr refi||4.36%||4.26%|
|15 yr refi||3.79%||3.69%|
Today's featured rates:
General Electric is finally giving demoralized shareholders and employees a reason for hope. More
US regulators are close to slapping Wells Fargo with a $1 billion fine for forcing customers into car insurance and charging mortgage borrowers unfair fees. More
Ads from over 300 companies and organizations ran on YouTube channels promoting white nationalists, Nazis, pedophilia, conspiracy theories and North Korean propaganda, a CNN investigation has found. More
In 1998, Ntsiki Biyela won a scholarship to study wine making. Now she's about to launch her own brand. More
A plan that lowers your student loan payments and offers some forgiveness isn't always the best choice. More