Tuesday, June 5, 2007

Two-Year U.S. Treasury Yield Touches 5 Percent, the Highest in Nine Months

(Bloomberg) -- The two-year Treasury note's yield
touched 5 percent for the first time since August after an
unexpected gain in a gauge of service industries prompted traders
to undo bets that the Federal Reserve will cut interest rates.

Traders who a month ago were convinced the Fed would lower
its target for the overnight lending rate between banks at least
once by year-end now see almost no chance of that happening,
interest-rate futures yields show. The increase in the Institute
for Supply Management's index of non-manufacturing businesses
follows stronger-than-forecast reports on employment and business
activity in the past week.


Read more at Bloomberg Bonds News

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