A lack of economic news kept Treasury securities largely unchanged in light trading typical of a summer Friday.
The price of the Treasury's main 30-year bond was down 3/32 point, or 93 cents per $1,000 invested. Its yield, which moves in the opposite direction, edged up 0.01 point from late Thursday to 6.90 percent.Prices of short-term Treasury securities were unchanged. Intermediate Treasury securities were up 1/32 point to 3/32 point, reported Dow Jones Telerate, a financial information service reported.
There was little news of importance to nudge market players into buying or selling bonds, analysts said.
Although the Federal Reserve Board's policymaking Open Market Committee meets next Tuesday, few traders expect any further reduction in interest rates, said Eric Hamilton of Technical Data Corp. in Boston.
Economic weakness this spring prompted a Fed rate reduction last month, but hopes for another have largely faded.
"Recent economic data has showed modest signs of a rebound in the economy, especially in the manufacturing sector, which has been the hardest hit over the last couple of months," said Hamilton. "That should leave the market somewhat range-bound and Fed expectations on hold heading into next week."
Rate cuts boost the price of existing bonds, because they will carry a higher interest payment compared to new issues.
The Lehman Brothers Daily Treasury Bond Index, reflecting price movements on bonds with maturities of a year or longer, was down 0.33 point at 1,238.71.
Yields on three-month Treasury bills declined to 5.59 percent as the discount fell 0.01 percentage point to 5.43 percent. Six-month yields fell to 5.70 percent as the discount fell 0.01 point to 5.46 percent. One-year yields were 5.86 percent as the discount edged down 0.02 percentage point compared to the rate set at Thursday's auction to 5.53 percent.
Yields are the interest bonds pay by maturity, while the discount is the interest at which they are sold.
The federal funds rate, the interest on overnight loans between banks, was 55/8 percent, down from 53/4 percent late Thursday.
In the tax-exempt market, the Bond Buyer index of 40 actively traded municipal bonds closed at 111 11/16, up 1/32 from Thursday. The average yield to maturity was 6.31 percent, unchanged.