from Bloomberg:
Treasuries rose amid speculation banks may need additional infusions of cash after the government completes its tests of balance sheet strength.
The so-called stress tests were designed by President Barack Obama’s administration to show how much extra capital the 19 largest U.S. banks may need to survive a deeper economic slump. The Federal Reserve will buy notes maturing between two and three years in the first of this week’s three buybacks, part of its effort to reduce borrowing costs.
“Apparently the stress test numbers were released to individual banks over the weekend,” said Kedric Dines, head of interest-rate and commodity derivatives marketing in New York at Mizuho Corporate Bank. “People are bracing for potential shocks there, if there are any leaks.”
The yield on the 10-year note fell seven basis points to 2.85 percent as of 9:40 a.m. in New York, according to BGCantor Market Data. The price of the 2.75 percent security due February 2019 rose 9/32, or $2.81 per $1,000 face amount, to 98 25/32.
