The Federal Reserve took no credit tightening action yesterday and Treasury prices fell, leaving the short end largely intact but chipping away more than half a point from the long bond.

With the Federal Open Market Committee's doors closed until midafternoon, traders were kept on the edge of their seats and uncertain of what to do for most of the day. When the Fed finally announced that the FOMC meeting was over with no change in rates, traders got busy and sparked selling in the long end because their inflation fears were not laid to rest. Economists expect a tightening of monetary policy at the next FOMC meeting on Nov. 15, if not sooner.

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