Bonds Recover From Early Retreat
Apr. 27, 1999
NEW YORK (AP) _ Treasury bond prices rose Tuesday, as the dollar gained against the yen while U.S. officials pushed Japan to do more to stimulate demand for goods across Asia.
The price of the benchmark 30-year Treasury bond rose 14/32 point, or $4.38 cents per $1,000 in face value. Its yield, which moves in the opposite direction, fell to 5.54 percent from 5.57 percent Monday.
Helping bonds were gains in the dollar against the yen, boosting the allure of U.S. assets to foreign investors who must convert their proceeds to other currencies. The dollar had its biggest gain against the yen in a week on indications that Japan won't spend more to help its economy out of the worst recession in 50 years.
The dollar's rise against the yen came as Treasury Secretary Robert Rubin exhorted Japan and Europe to do more to stimulate demand.
In the broader market, prices of short-term Treasury securities finished between unchanged and up 1/16 point, and intermediate maturities rose 3/32 point, reported Bridge Telerate, a financial information service.
Yields on three-month Treasury bills were 4.48 percent as the discount rose 0.04 percentage point from Monday to 4.37 percent. Six-month yields were 4.58 percent, as the discount rose 0.01 percentage point to 4.41 percent. One-year yields were 4.68 percent as the discount was unchanged at 4.47 percent.
Yields are the interest bonds pay by maturity, while the discount is the interest at which they are sold.
The federal funds rate, the interest on overnight loans between banks, was unchanged at 4.88 percent from Monday.
In the tax-exempt market, the Bond Buyer index of 40 actively traded municipal bonds rose to 123 15/16 from 123 25/32. The average yield to maturity rose to 5.26 from 5.25 percent Monday.