Treasurys Rise Slightly as Few Are Surprised That Fed Chooses Not to Change Interest Rates
NEW YORK -- Favorable inflation data and the Federal Reserve's decision to keep interest rates unchanged helped the Treasury market edge higher in listless, range-bound trading.</br></br>Because much of the positive news was already priced into the market, Treasurys didn't react with much enthusiasm to news that buttressed the market's already strong fundamentals.</br></br>The bellwether 30-year bond rose 5/32, or $1.5625 for a bond with a $1,000 face value, at 102 7/32. The bond's yield, which moves in the opposite direction of its price, fell to 5.956% from 5.967%.</br></br>Shorter-term securities moved little, however. The two-year note, for example, fell 1/32, or $0.313.</br></br>Few market participants were surprised when the Fed's Open Market Committee elected not to change monetary policy during its last policy meeting of the year, keeping the fed funds target rate at 5.50%. The decision was expected because the Fed had provided the market with no indication that it was contemplating a rate change, and because a rate increase would likely have handicapped still-struggling Asian economies.