NEW YORK: US Treasuries prices were little changed on Tuesday after a brief surge on a false Twitter message from the Associated Press that said there were two explosions at the White House.
The tweet, which an AP spokesman called "bogus," raised concerns of another terror attack just a week after the Boston Marathon bombs and caused a short-lived scramble for safe-haven US bonds.
When the AP tweet was retracted, buying of Treasuries faded, sending prices back to little changed.
In an otherwise uneventful day for the bond market, benchmark 10-year Treasury notes were down 2/32 to 102-23/32 in mid-afternoon trading to yield 1.701 percent.
The 10-year yield dropped to 1.643 percent after the false AP tweet circulated among traders, hitting its lowest intraday level since Dec. 12, according to Reuters data.
"When you have this story print when you're at the lows of the day (in price) and it takes you back to the highs of the day (in price), you've done a tremendous amount of damage in very little time," said Sean Murphy, Treasuries trader at Societe Generale in New York.
Murphy said prior to this traders were likely building short positions in expectation of a move higher in yields, but the sharp move caused those positions to be unwound quickly.
Earlier, Treasury yields were hovering near their lowest levels of the year as data suggested another spring global slowdown, which major central banks might have to ward off with more stimulus.
A round of business surveys on Tuesday showed major economies around the world lost some momentum this month. Among the day's data, US manufacturing grew at its most sluggish pace in six months.
The 30-year bond was little changed at 104-21/32 to yield 2.890 percent. The 30-year yield fell to 2.823 percent earlier, the lowest level since Dec. 12.
Concerns about deteriorating economic growth worldwide, together with bets that Japanese investors will buy more US and other higher-yielding foreign bonds, have limited the rise in yields the past couple of weeks.
Investors also speculated the European Central Bank could be leaning toward cutting interest rates after comments from policymakers stressing falling inflation and poor growth prospects.
The day's weak data out of the euro zone added to that view, as Germany's services sector shrank. The ECB meets next week.
"It's clear that there's still a lot of issues and weak growth on the continent. It (would be) another measure to show they're being proactive," said Justin Lederer, Treasury strategist at Cantor Fitzgerald in New York.
"A lot of people in general are looking more for June but now it could come as soon as next week, given where the German data was overnight," said Lederer.
<Center><b><i>Copyright Reuters, 2013</b></i><br></center>
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