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Treasuries Fall as Oil Spurs Inflation Concern - 2008/03/27 19:49
Hey guys, I just took a look at bonds and saw that nobody had made an update on this, so I'm posting a small report just to keep us up-to-date. Bonds are not my favorite in the short term but if you trade them in the long run you may get a nice surprise 
Treasury notes fell, ending two days of gains, as rising oil prices spurred concern U.S. inflation will accelerate and before the government's biggest auction of five-year securities since 2003.
Thirty-year bonds, those most sensitive to inflation, declined as crude exceeded $107 a barrel after yesterday rising the most in three weeks. Traders added to bets the Federal Reserve will cut its benchmark interest rate half a percentage point next month to buoy the economy, raising the prospect inflation will accelerate. The Treasury will today sell $18 billion of five-year debt.
The yield on the 10-year Treasury note rose 3 basis points to 3.49 percent as of 7:35 a.m. in New York, according to bond broker Cantor Fitzgerald LP. The price of the 3 1/2 percent security due February 2018 declined 8/32, or $2.50 per $1,000 face amount, to 100 3/32. Ten-year yields will climb to 3.80 percent by the end of June, Calyon forecasts.
Thirty-year bond yields gained 4 basis points to 4.35 percent. Five-year yields climbed 5 basis points to 2.54 percent.
Crude oil rose for a third day to its highest level in more than a week after a pipeline explosion in southern Iraq threatened to crimp supply. The price for May delivery rose as much as 1.7 percent to $107.70 a barrel on the New York Mercantile Exchange, before trading at $106.92.
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