Treasury 10-Year Notes Fall Most Since March 2006

Bloomberg reports:

The benchmark 10-year Treasury note fell the most since March 2006 this week on concern the Federal Reserve's surprise half-point interest-rate cut may rekindle inflation.

The Fed on Sept. 18 reduced its target for the overnight lending rate between banks to 4.75 percent, more than most economists had expected, to protect the nation from sinking into a recession sparked by fallout from the housing-market collapse. Reports next week are forecast to show the pace of home sales slowed in August and consumer confidence declined this month.

``The Fed is goosing the economy,'' said T.J. Marta, a fixed-income strategist in New York at RBC Capital Markets, the investment-banking arm of Canada's biggest lender. The cut in borrowing costs ``is going to go a long way toward keeping the economy out of recession.''

Yields on 10-year notes rose 17 basis points, or 0.17 percentage point, to 4.63 percent this week, according to bond broker Cantor Fitzgerald LP. The price of 4 3/4 percent notes maturing in April 2017 fell 1 11/32, or $13.44 per $1,000 face amount to 100 31/32. Yields move inversely to bond prices

How about that for successful Fed easing?