A series of indicators showing the economy is on the verge of a recovery sent the Treasury long bond back towards 8 1/2% last week, and some analysts think the 30-year could steam right on through to 8 3/4%, especially if the inflation news this week is bad.

In the wake of the surprising rebound in May nonfarm payrolls Friday, the 30-year closed 1/2 lower on the day, and down more than 2 points on the week, to yield 8.46%. That is the highest closing yield since late November.

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