Two-year US Treasury yields fall

Two-year US Treasury bonds saw yields decline as prices rose a bit. Investors were looking for safe, short-period places to put their money as problems in the subprime mortgage business again surfaced. There are concerns that the trouble in that part of the mortgage sector could extend into the full sector. The two-year paper was yielding 4.96 percent on Thursday afternoon, down from 4.98 percent yields late on Wednesday.

Prices fell, however, on longer-dated bonds after the Philadelphia Federal Reserve reported that manufacturing activity in its region was much higher in June than it was in May. Ten-year issues saw yields up to 5.15 percent, from 5.14 percent on Wednesday. Thirty-year treasury bonds were also yielding a bit more, up to 5.27 percent on Thursday from 5.25 percent on Wednesday.

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