Treasuries Firm

Treasuries firmed in afternoon trading on Tuesday after Fed comments; the bond market traded in a tight range in anticipation of Wednesday's CPI numbers

Treasuries endured another tight range on Tuesday, losing ground early on, but then reversing later in the day. The market is awaiting tomorrow' report on December Consumer Price Index, which is expected to be up 0.2%, same as in November, according to Marketscope. Prices sat at the lows for much of the session, but turned around later on rate lock buying, with the long end leading as the Fed's Pianalto comments stressed inflation fighting, said Informa. Most Fed speakers today said the Fed would act more aggressively to tighten credit if the conditions warranted it, according to Marketscope. There was little reaction to a lower Empire State index or to the November Treasury's International Capital data, which showed a sharpjump in foreign Treasury holdings.

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