Treasuries Close Modestly Higher But Well Off Best Levels

(RTTNews) - After seeing early strength, treasuries gave back ground over the course of the trading day on Monday but managed to close modestly higher.

Bond prices finished the day in positive territory but well off their highs for the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.4 basis points to 2.098 percent.

The early strength among treasuries was partly due to some disappointing economic data, including a report from the National Association of Home Builders showing that homebuilder confidence fell to its lowest level in eight months in March.

The report said the NAHB/Wells Fargo Housing Market Index fell to 53 in March from 55 in February. The drop surprised economists, who had expected the index to inch up to 56.

With the unexpected decrease, the housing market index fell to its lowest level since hitting a matching reading last July.

A separate report released by the Federal Reserve showed that industrial production grew by less than expected in the month of February.

The Fed said industrial production inched up by 0.1 percent in February following a revised 0.3 percent decrease in January.

Economists had expected production to rise by 0.3 percent compared to the 0.2 percent increase originally reported for the previous month.

A Commerce Department report on housing starts is likely to attract some attention on Tuesday, although traders may be looking ahead to the Fed's monetary policy announcement on Wednesday.