Treasury 30-year Bonds Decline

"A lot of people are waiting on the sidelines" as the Fed opens a policy meeting.

Treasury 30-year bond yields touched the lowest level in more than a week before the Federal Reserve opens a two-day policy meeting amid speculation on whether it will take further steps to boost economic growth.

Long bonds briefly erased gains after the Fed bought $1.92 billion of long-term U.S. securities. Treasuries erased early losses amid concern European leaders will struggle to stem their debt crisis even after pro-bailout parties in Greece won enough votes to form a government. Spanish bond yields climbed to more than 7 percent for the first time in the euro era.

Inflation Outlook

The yield gap between 10-year notes and Treasury Inflation Protected Securities, or TIPS, which signals traders’ outlook for the rate of inflation over the life of the debt, touched 2.10 percentage points. It reached a 2012 low of 1.9 percentage points on Jan. 3 and a high of 2.45 percentage points March 20. The five-year average is 2.02 percentage points.

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