Bonds moved higher in price in early trading Monday after a report New York Fed's July Empire State index that unexpectedly rose to 26.44
in July from 25.75 in June. The market is awaiting Fed chariman Ben Bernanke's semiannual economic forecast to Congress Wednesday.
Action Economikcs reports that subprime fears remain in the market, though they're a bit more subdued than last week where subprime took top billing as the big 3 ratings agencies looked to downgrade, or actually cut their outlooks on various issues backed by risky mortgage paper.
The 10-year note was higher in price at 95-16/32 for yield of 5.093%, while the 30-year bond was higher at 93-23/32 for a yield of 5.171%.