Despite late-breaking news that Greece reached a deal on a five-year austerity plan, the prices of safe-haven US Treasuries rose on Thursday as euro zone worries drove investors out of riskier assets. A Reuters report that Greece had reached an austerity agreement, one of the steps it needed to take to receive aid from the European Union and the International Monetary Fund, partially reversed heavy selling in stocks.
Signs of fear were everywhere: The 30-year Treasury bond briefly traded a full point higher in price and 30-year bond futures contracts hit new highs, while the rates of one-month and three-month Treasury bills dipped into negative territory in morning trading. Strong appetite for bonds manifested in record bidding at a $7 billion sale of 30-year Treasury Inflation-Protected Securities.
Benchmark 10-year Treasury notes last traded up 17/32 with their yield at 2.91 percent, down from 2.98 percent late on Wednesday. The 10-year yield traded as low as 2.90 percent, within striking distance of the six-month intraday low set last week at 2.88 percent. The two-year yield came close to a record low.