WASHINGTON -- Treasury securities prices on the long end inched up yesterday in sparse trading as the market braced itself for today's third-quarter gross domestic product report.
"It's a market holding its breath," said Brian Wesbury, chief economist of Griffin, Kubik, Stephens & Thompson Inc.
Late yesterday, 30-year bonds were quoted up 6/32 at a price of 93 26/32, yielding 8.04%; and 10-year notes were up four ticks at 95 25/32, yielding 7.87%.
Meanwhile, the short end was narrowly mixed: Yields on three-month bills were up two basis points to 5.13%, and yields on six-month bills were down one basis point to 5.69%.
Those small gains at the long end really don't mean anything in a market priced for so much potentially bad news in the GDP report, analysts said.
Wesbury speculated that a stronger-than-expected inflation measure in today's report would agitate the bond market more than a higher-than-anticipated third-quarter growth estimate because inflation estimates are revised less.
Analysts on average predict 2.8% real GDP growth in the third quarter. down from 4.1% in the prior quarter; and about a 3% gain in the GDP price deflator, up from the previous gain of 2.9%.
The market is headed lower in the face of rising inflationary pressures, analysts reiterated.
Treasury Market Yields Previous Previous Thursday Week Month 3-Month Bill 5.09 5.11 4.656-Month Bill 5.68 5.65 5.421-Year Bill 6.19 6.16 5.922-Year Note 6.87 6.74 6.563-Year Note 7.08 7.04 6.865-Year Note 7.53 7.44 7.267-Year Note 7.70 7.62 7.4410-Year Note 7.85 7.77 7.6130-Year Bond 8.04 7.99 7.83
Source: Cantor, Fitzgerald / Telerate
Stock Market: The Dow Jones lndustrial Average rose 26.92 points yesterday to close at 3875.15.
Foreign Exchange: In late New York trading yesterday, the dollar was quoted at 97.05 Japanese yen and 1.4985 German marks.
Commodities: The Commodity Research Bureau's index closed up 1.66 points yesterday at 234.96.