Treasuries Fall as Fed Plan Boosts Inflation Indicators
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Treasury 30-year bond yields climbed the most in three years after Federal Reserve Chairman Ben Bernanke’s pledge to keep adding stimulus even as the economy improves spurred concern inflation will accelerate.
The yield gap between 10- and 30-year Treasuries widened to the most in a year yesterday amid bets the value of longer-term fixed-income holdings will erode more over time. Relative yields on mortgage securities slid to the lowest on record after the Fed said Sept. 13 it would expand its holdings with open-ended monthly purchases of $40 billion of the debt. The U.S. will sell 10-year Treasury Inflation Protected Securities next week.