Treasuries Close Modestly Higher As Fed Meeting Looms

(RTTNews) - Following recent weakness, treasuries showed a modest move back to the upside during trading on Monday.

Bond prices moved higher in early trading and managed to maintain a mostly positive bias throughout the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.1 basis points to 1.834 percent.

The modestly higher close by treasuries came after the Commerce Department released a report showing that personal income increased by slightly less than expected in the month of September, although personal spending rose in line with estimates.

The report said personal income climbed by 0.3 percent in September after edging up by 0.2 percent in August. Economists had expected income to rise by 0.4 percent.

Meanwhile, the Commerce Department said personal spending increased by 0.5 percent in September following a 0.1 percent dip in August. The increased in spending matched economist expectations.

A separate report from MNI Indicators showed an unexpected slowdown in the pace of growth in Chicago-area business activity in the month of October.

MNI Indicators said its Chicago business barometer dropped to 50.6 in October from 54.2 in September, although a reading above 50 does indicate growth. Economists had expected the index to inch up to 54.3.

Trading activity remained somewhat subdued, however, as traders looked to the Federal Reserve announcement on Wednesday and the monthly jobs report due on Friday.

The Institute for Supply Management is scheduled to release its report on manufacturing activity on Tuesday, but trading activity may remain light as the Fed announcement looms.