- The Washington Times - Monday, April 20, 2009

NEW YORK (AP) - Treasurys rebounded Monday as stocks tumbled, leading investors to put their money back in safer assets like government debt.

Stocks, having surged more than 20 percent in just a few weeks, were due for a pullback, analysts said. Monday’s news gave investors that opportunity: Bank of America Corp., despite posting a profit for the first quarter, said it had to add massively to reserves to prepare for a huge wave of loan losses.

Another driver for Treasurys was European Central Bank President Jean-Claude Trichet, who said he is not ruling out another rate cut, according a Japanese media report over the weekend.

The benchmark 10-year Treasury note rose 31/32 to 99 8/32. Its yield dropped to 2.84 percent from 2.95 percent late Friday. Since March 18, when the Federal Reserve said it would start buying $300 billion in Treasurys over six months, the 10-year yield has not surpassed 3 percent.

The 30-year bond rose 2 3/32 to 96 22/32, and its yield fell to 3.69 percent from 3.81 percent.

The two-year note rose 4/32 to 99 29/32, and its yield fell to 0.92 percent from 0.97 percent.

The yield on the three-month Treasury bill dipped to 0.12 percent from 0.13 percent. The discount rate was 0.13 percent.

The cost of borrowing between banks was flat. The London Interbank Offered Rate, or Libor, on three-month loans in dollars stayed at 1.10 percent. The three-month dollar rate is near its all-time low of 1.08 percent reached in January.


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