Treasurys up after ECB denies yield report
SAN FRANCISCO (MarketWatch) -- Treasury prices edged up on Monday, pushing yields down slightly, after a European Central Bank spokesperson called misleading a report in Germany's Der Spiegel magazine, which said the ECB is considering a plan to cap euro-zone government-bond yields.
Yields on 10-year notes (10_YEAR) , which move inversely to prices, fell 1 basis point to 1.81%, after touching 1.86% earlier -- their highest level in about three months.
A basis point is one one-hundredth of a percentage point.
Thirty-year bond yields (30_YEAR) increased to 2.98% before reverting back to 2.92%, down 1 basis point on the day.
Yields on 5-year notes (5_YEAR) turned down 1 basis point to 0.79%, coming off their highest level since May.
The ECB's response damped investors' appetite for riskier assets including stocks and the euro (EURUSD) .
Separately, Germany's central bank, the Bundesbank, reiterated its opposition to a resumption of bond purchases by the ECB. Read more on ECB, euro.
"What's good for Spain is bad for Germany and the U.S. when it comes to bond prices," said bond strategists at RBS Securities, noting that yields on both governments' debt rose. More broadly, yields rose due to "building optimism that the ECB will be firing big guns come September," they said.
U.S. stocks extended their decline mid-morning, boosting the appeal of Treasury bonds.
Treasury yields rose to their highest level in about three months last week following mixed U.S. economic data and as traders positioned for a series of meetings this week that may address the European sovereign-debt crisis. Read more about Treasury yields.