Treasuries Extend Recent Decline With Modest Drop

(RTTNews) - Extending a recent downward trend, treasuries moved modestly lower over the course of the trading session on Monday.

Bond prices showed a lack of direction for much of the session before ending the day on the downside. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by 1.4 basis points to 1.902 percent.

With the increase on the day, the ten-year yield closed higher for the sixth straight session, reaching its highest closing level in a month.

The continued weakness among treasuries came as traders looked ahead to the Federal Reserve's monetary policy announcement on Wednesday.

The Fed is widely expected to leave interest rates unchanged, but traders are likely to keep a close eye on the accompanying statement for clues about the outlook for the next meeting in June.

On the U.S. economic front, the Commerce Department released a report showing an unexpected decrease in new home sales in the month of March.

The report said new home sales fell 1.5 percent to an annual rate of 511,000 in March from a revised rate of 519,000 in February.

The decrease surprised economists, who had expected new home sales to climb to a rate of 522,000 from the 512,000 originally reported for the previous month.

Despite the monthly decrease, new home sales were still up by 5.4 percent compared to a rate of 485,000 in the same month a year ago.

Looking ahead, trading on Tuesday may be impacted by reaction to reports on durable goods orders, home prices, and consumer confidence.