Yield on 10-yr Treasury rises on Bernanke speech

AP News
Posted: Aug 26, 2011 4:30 PM
Yield on 10-yr Treasury rises on Bernanke speech

The yield on the 10-year Treasury note rose Friday after Federal Reserve Chairman Ben Bernanke gave a speech saying the U.S. economy was poised for growth.

Bernanke said Friday the economy is fundamentally sound and will grow over the long term. He signaled no new rounds of bond-buying by the central bank, as some traders had hoped.

Bernanke's positive assessment of the U.S. economy sent stocks higher. The Dow Jones industrial average closed up 134 points. Money flowed out of Treasurys, pushing the 10-year yield higher. A bond's yield rises as its price falls.

The yield on the 10-year Treasury note was 2.19 percent in late afternoon trading. It fell as low as 2.13 percent earlier Friday after a dismal report on economic growth in the second quarter.

The Commerce Department lowered its estimate of second-quarter U.S. economic growth to an annual rate of just 1 percent, down from its earlier estimate of 1.3 percent.

Ten-year notes yielded 2.24 percent late Thursday. The price of the 10-year note was up 40 cents per $100 compared with late Thursday.

The yield on the 30-year Treasury bond fell to 3.53 from 3.61 late Thursday. Its price was up $1.31 per $100.

The two-year Treasury note yielded 0.19 percent, down from 0.22 percent.

The three-month T-bill paid a yield of 0.01 percent, unchanged from late Thursday. Its discount wasn't available.