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August 15th, 2012
September 30-Year Bonds traded sharply lower throughout the session, falling to its lowest level since May 17th. Treasury markets came under pressure during the early Asian trade as they reacted to yesterday’s favorable US retail sales figures. This pushed September 30-Year Bonds below last week’s low of 147-10 and appeared to trigger a round of stop-loss selling. Prices managed to recover heading into the first tier of US economic data, which highlighted benign consumer inflation and weaker than expected manufacturing activity in New York. However, gains were shallow and prices reversed into new low on the session following the second wave of US economic readings. The latest round of upbeat economic data appears to have reduced the prospect of more Fed quantitative easing at their September meeting. Some traders also pointed to a very active flow of corporate issuance as another force pressuring Treasury prices lower. In an interview later in the session, Dallas Fed President Fisher reiterated his stance that providing more monetary stimulus would not lower unemployment levels.
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