The yield was 3.17% today as of 12:57 p.m. in Tokyo.
'Left Behind'
Yields have plunged from the highs this year of 3.77% on Feb. 9 on concern rising energy and food costs will restrain the economy after U.S. gross domestic product expanded at a 1.8% annual rate last quarter. That's the slowest pace since the three months ended June 30.
"Our economy is far from where we would like it to be, and many people and neighborhoods are in danger of being left behind," Bernanke said in a speech in Arlington, Virginia, on April 29. "The broader economy is in a moderate recovery."
The central bank will keep its target rate for overnight loans between banks in a range of zero to 0.25% through year-end, according to the median estimate of 80 economists surveyed by Bloomberg News. A separate poll shows they expect 10-year yields to remain below 4% in 2011.
Fed Driving Volatility
"The primary driver of volatility right now is Fed policy," said Priya Misra, head of U.S. rates strategy at Bank of America Merrill Lynch in New York, one of the 20 primary dealers that trade with the Fed. "The hurdle to a hike seems high because of the growth picture and the hurdle to ease is high because of inflation concerns."
Volatility averaged 90.75 basis points in the five years before June 2007, as measured by the MOVE index, which tracks price swings based on over-the-counter options maturing in 2 to 30 years. The index then soared to a record 264.6 following the collapse of Lehman Brothers Holding Inc. in September 2008.
While the debt market may be sanguine, the world's biggest bond investor said last week that relatively low yields on Treasuries fail to compensate for the risks of the securities.
'Abdication Of Responsibility'