By The Associated Press
NEW YORK (AP) - Treasury prices dropped Tuesday on reports that European officials may relax some lending terms for Greece.
News that Greek political parties could form a government this week also helped lure traders out of the safety of Treasurys.
The price of the 10-year Treasury note fell 40 cents for every $100 invested. The yield, used as a benchmark for mortgages and corporate loans, rose to 1.62 percent. That's up from 1.58 percent late Monday.
A European official said Tuesday that the terms of Greece's bailout loans needed to be renegotiated. Other reports said German government officials were considering giving the new government more time to meet budget targets required by international lenders.
Fears about the European debt crisis have kept banks and big investors in the Treasury market, widely considered one of the safest places in the world to park cash.
In other Treasury trading, the price of the 30-year bond fell $1.53. Its yield jumped to 2.73 percent from 2.67 percent Monday. The yield on the two-year note remained at 0.29 percent.
Trading was thin as bond buyers wait for the Federal Reserve to wrap up a meeting Wednesday. Many expect the Fed to extend a program in which it sells short-term bonds to buy long-term ones.
In the market for short-term Treasury bills, the three-month T-bill paid a yield of 0.09 percent.
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