U.S. government bonds fell a second day Friday as $7 billion in corporate debt sales sapped demand for Treasuries.
"Nobody is going to rush out to buy Treasury bonds," said Jim Snyder, who is adding mortgage-backed and corporate bonds to the $4.8 billion he invests for American Express Asset Management in Minneapolis. Treasuries "aren't any great value right now, when most corporate and mortgage-backed securities" offer far better yields, he said.
The 30-year Treasury fell $6.25 per $1,000 face amount, to $102.53125. Its yield rose 4 basis points, to 5.94%. Yields on two-year notes, more sensitive to Fed rate expectations, rose 3 basis points, to 5.61%.
Treasuries rallied earlier in the week on expectations that Tuesday's Federal Reserve rate increase would be the last for the year. They had been up more than 1.75 points by late Wednesday.
Corporate treasurers have been rushing to sell debt this year, well before any year-2000 computer glitches might arise. The sales still could accelerate, with bankers estimating that $6 billion to $8 billion a week will be issued in September.