Subprime worries send Treasury bond prices higher

Prices were up slightly on US Treasury bonds on Wednesday and yields fell as investors worried about the effect troubles in the subprime mortgage market might have on the wider mortgage market and bonds looked like a safe place to put money. A weak durable goods order report also aided bonds. Orders were down by 2.8 percent in May on an expected decline of only 0.8 percent.

Two-year Treasury bonds were steady, yielding 4.87 percent, while longer-term bonds fell slightly. Five-year issues were at 4.94 percent. Ten-year paper yielded 5.07 percent, while thirty-year bond yields were at 5.19 percent.

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