The yield on the 10-year bond touched the lowest level in one week & Treasuries rose for the third consecutive day

Treasuries rose for the third consecutive day the longest winning streak this month that the Federal Reserve prepared to buy up to $ 17 billion in two operations, the most in a single day.

The yield on the 10-year bond touched the lowest level in one week military exercises in South Korea and threats of retaliation by the North increased demand for safety. The European Central Bank said last week that it has "serious doubts" that the banking legislation introduced by the Irish government endangers the ECB's ability to execute its liquidity operations.

"The market is a bit exhausted right now," said David Ader, head of government bond strategy in Stamford, Connecticut, of CRT Capital Group LLC. "People have been battered, beaten and shocked by the decision we had to higher yields. They're saying," Maybe we did enough and we sell the purchase of the Fed. "

The yield on the benchmark 10-year fell six basis points, or 0.06 percentage point to 3.27 percent at 9:47 am in New York, according to BGCantor Market Data. The price of 2,625 per cent security due in November 2020 gained 02.01, or $ 5 per $ 1,000 face amount, to 94 18/32.

The yield touched 3.26 percent, the lowest since Dec. 13, rising to 3.56 percent on Dec. 16, the highest since May 13. Yields will be reduced to 2.98 percent on March 31.

Fed LBO

The Fed will hold two separate purchases of U.S. debt today as part of its plan to buy 600 billion U.S. dollars in bonds over Treasuries June and reinvest your maturing mortgage. The central bank expects to reinvest $ 250 000 000 000 to $ 300 million dollars in revenue from mortgage-backed debt and agency securities in Treasury bonds during that time.

From 10:15 am New York, the central bank will purchase Treasury bonds due in February 2018 to November 2020. The Fed plans to buy $ 7000000000 $ 9 billion worth today, according to the website of the New York Fed. This operation will close at 11 am

Starting at 1:15 pm and ends at 2 pm, the Fed will buy Treasuries maturing in December 2014 to May 2016. The central bank purchase of $ 6 million and $ 8 billion of bonds in this maturity level.

The purchase amount would be the biggest since the Fed restart the program after completing the purchase 1700000000000 dollars of debt in March.

Ried Thunberg survey

Fund managers in a survey of Ried Thunberg ICAP week became less pessimistic about the outlook for Treasuries in March. Ried sentiment index rose to 48 for the seven days ended December 17, 1946 before the week. A figure below 50 indicates investors expect prices to fall.

The company, which is a unit of the world's largest broker interbank and is based in Jersey City, New Jersey, interviewed 26 money managers control $ 1380000000000.

U.S. government bonds have fallen this month as the gap between yields on Treasuries with longer maturities showed second round of quantitative easing, the Fed may be your last.

The difference between 10 - and 30-year yields fell to 1.05 percentage points on December 15 from a record 1.60 points on November 10, the most since the 1980s. The change in the yield curve is carried out as Bank of America Merrill Lynch index data show U.S. bonds due in 10 years or more lost 4.64 percent this month, cutting 2,010 Gain to 8.37 percent.

U.S. Economy

Flattening usually heralds the end of the Fed cuts interest rates to stimulate growth. U.S. reports this month showed gains in retail sales, consumer sentiment and industrial production after the central bank increased its balance to a record high of 2.39 billion, injecting money into the financial system. Is the addition of 600 billion dollars, buying Treasury bonds through quantitative easing.

"A peak in the yield spread between 10 and 30 marks the end of an easing cycle," said Steven Wieting, managing director of economic and market analysis at Citigroup Inc.

Bonds won the ECB said in a position paper dated Dec. 17 and posted on their website that has "serious doubts" that the Irish law the bank may threaten the central bank independence and ability to execute trades of liquidity . The Irish Government on December 14 introduced legislation that would give power to alter the rights of bondholders "in the payment of interest and debt and to appoint administrators to banks if needed.

South Korea said a live-firing drill that brought threats of retaliation by North Korea was completed without incident, after the Security Council failed to agree on measures to ease the tension on the peninsula .