Treasuries close little changed

10-year yield.pngClick chart for prices and yields. By Blake Ellis, staff reporter


NEW YORK (CNNMoney) -- Treasury prices were little changed Tuesday following the release of minutes from the Federal Reserve's latest policy meeting.

Those minutes revealed that policymakers at the Fed were divided in their outlook for the economy, suggesting that the central bank is unlikely to change direction any time soon.

In early trading, a stronger-than-expected report on factory orders did little to move the market out of its rut.

Meanwhile, sales figures from major auto companies were released throughout the day. Most automakers posted strong sales, raising hopes that the industry could carry some momentum into the new year.

With no auctions scheduled, the closely-watched jobs report on Friday is really the main focus this week. Economists expect the monthly report to show employers boosted payrolls by 135,000 last month, after adding 39,000 jobs in November.

Federal Reserve Chairman Ben Bernanke is also scheduled to testify before the Senate budget panel on Friday, and traders will be listening closely for more hints about the health of the economy.

What yields are doing: The yield on the benchmark U.S. Treasury 10-year note edged up to 3.33%. Bond prices and yields move in opposite directions.

The yield on the 30-year bond was slightly higher at 4.41%, while the 2-year note's yield hovered at 0.61%. The yield on the 5-year note rose slightly to 2.00%.

Bullish traders scrutinized the Fed statement for comments acknowledging that the economy is picking up pace going into 2011, and bearish investors hunted for "any hints of disagreement that could bring a premature stop to QE2," said Jim Vogel, head of agency debt research at FTN Financial.

The divided outlook issued by the Fed initially sent benchmark 10-year yield higher, before reversing course and closing little changed for the day.

At its latest meeting, the central bank held interest rates at historically low levels and said that while it expects a gradual recovery, progress has been "disappointingly slow." To top of page

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