Bonds slump as Greece abandons referendum plan

AP News
Posted: Nov 03, 2011 4:10 PM
Bonds slump as Greece abandons referendum plan

U.S. Treasury prices slumped Thursday after Greece's prime minister scrapped a referendum on unpopular budget cuts.

Markets were spooked earlier in the week after Greek Prime Minster George Papandreou said he would put a package of austerity measures to a public vote. A "no" vote could have unraveled a rescue package intended to prevent another financial crisis in Europe.

Slightly better U.S. economic news also sent bond prices lower. New applications for unemployment fell to the lowest level in five weeks.

The price of the 10-year Treasury note fell 66 cents for every $100 invested. The yield was 2.06 percent, up from 1.99 percent late Wednesday.

The yield on the 30-year Treasury rose to 3.11 percent from 3.01 percent late Wednesday. Its price fell $1.94 per $100 invested.

The yield on the two-year note rose to 0.25 percent from 0.23 percent.

The three-month T-bill paid a yield of 0.01 percent. Its discount wasn't available.