Long-term Treasury bonds are soaring in price, sending their yields tumbling to their lows for the year. The 30-year “long bond” is the star performer, surging 2 6/32 in price, or $21.88 per $1,000 bond.
Put another way, that would be equivalent to roughly a 225-point jump in the Dow Jones Industrial Average–a near mirror image of the Dow’s 237-point decline at late morning. That surge put the long bond’s yield close to the 4% mark, at 4.127%, the lowest since last October. That’s also down a big 70 basis points (seven-tenths of a percentage point) since early April, when the consensus opinion asserted Treasury yields had nowhere to go but up.
This comes amid an accelerated flight from risk assets amid the continuing crisis in Europe, which has failed to prop the euro, and renewed signals of weakness in U.S. indicators, notably an unexpected jump in jobless claims in the latest week. Even gold is off amid the scramble for the safest, most liquid assets, which are Treasuries these days.
Meantime, the benchmark 10-year note is up a full point, or $10 per $1000 note, putting its yield at 3.25%, the lowest since late December. But perhaps most telling is the plunge in the two-year note yield, which is most sensitive to expectations about monetary policy moves. which hit just 0.713%, a drop of six basis points on the session.
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