Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Treasury yields slip as Fed announcement looms

10-yryield.top.pngClick chart for prices and yields. By Ben Rooney, staff reporter

NEW YORK (CNNMoney.com) -- Treasury prices ended the session higher Tuesday as investors continued to anticipate another round of asset purchases from the Federal Reserve.

The advance came as Americans went to the polls to vote in the midterm Congressional election. Many investors expect the Republican party to gain control of the House, while the Senate is also in play.

While a shift to the right on Capitol Hill is generally seen as a positive development for Wall Street, traders said the market is mostly focused on Wednesday's policy statement from the central bank.

"It's primarily the outlook for the Fed that's got Treasuries buoyant today," said Kim Rupert, fixed-income analyst at Action Economics.

The Fed kicks off its two-day meeting with a highly anticipated policy statement due Wednesday afternoon. The central bank is expected to unveil a new round of asset purchases, as part of a wider quantitative easing plan.

Rupert said the consensus view in the market is for the Fed to announce plans to buy a total of $500 billion worth of Treasuries in $100 billion monthly increments. But she said the Fed is likely to keep its plans "open-ended."

The goal of quantitative easing is to put downward pressure on interest rates and pump money into the economy. It is also seen as a way for the Fed to combat deflation, a debilitating cycle of falling prices and demand.

However, some investors in the bond market are concerned that the Fed's efforts to juice the economy could lead to a bout of inflation in the years ahead. Rising prices can severely erode the value of fixed-income assets such as Treasuries.

"There are those who think the Fed's accommodative posture will push prices higher sooner rather than later," said Rupert.

The yield on the benchmark 10-year note fell to 2.6% from 2.63% late Monday. Bond prices and yields move in opposite directions.

The 2-year yield was little changed at 0.36%, while the 5-year yield eased to 1.16%.

The 30-year yield fell to 3.93% from 4.02% on Monday.  To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.92%3.92%
15 yr fixed2.99%2.98%
5/1 ARM3.26%3.12%
30 yr refi4.01%3.98%
15 yr refi3.08%3.04%
Rate data provided
by Bankrate.com
View rates in your area
Find personalized rates:
Index Last Change % Change
Dow 17,798.49 -14.90 -0.08%
Nasdaq 5,127.53 11.38 0.22%
S&P 500 2,090.11 1.24 0.06%
Treasuries 2.22 -0.01 -0.31%
Data as of 4:51am ET
Company Price Change % Change
General Electric Co 30.36 0.00 0.00%
Bank of America Corp... 17.48 0.04 0.23%
HP Inc 12.61 -0.03 -0.24%
Pfizer Inc 32.79 -0.08 -0.24%
Walt Disney Co 115.13 -3.54 -2.98%
Data as of Nov 27


Sumner Redstone, the media mogul who controls Viacom and CBS, is at the center of a legal dispute. One side says he is practically unable to make decisions for himself. The other says he is "engaged and attentive." More

Gold futures hit a low of $1,051.60 an ounce, yet another reminder of just how out of favor gold has become since its all-time high of nearly $1,890 in 2011. More

Watsi crowdfunds donations to cover healthcare costs of those in need. And it's seeing a surprising trend: micro-donations via the popular Chinese social networking app, WeChat. More

Hive, a startup funded by the UN, is tasked with getting more Americans engaged with the refugee crisis. More

Facebook just increased the amount of paid time off new dads working at its international offices can take. More