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Friday March 19, 02:15
Treasury decline deepens on al-Qaida news

U.S. Treasury note losses deepened after reports from Pakistani officials that troops are believed to have surrounded a key al-Qaida target, Osama bid Laden's second in command. The Associated Press is reporting that Ayman al-Zawahiri has been surrounded near the Afghan border, according to a Pakistani source. Treasury prices fell because the capture presumably would reduce the need for investors to seek "safe haven" investments. Terrorism worries have been among the factors driving up bond prices and driving down yields despite expectations of rising inflation. In fact, a stronger-than-expected rise in producer prices reported earlier Thursday was behind early price declines and helped lift yields from eight-month lows. The benchmark 10-year note was recently 6/32 lower at 102 5/32, yielding 3.74 percent.
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