US govt bonds close sharply higher

US government bond prices closed sharply higher, sending yields to new lows, after a weaker-than-expected July nonfarm payroll report raised expectations that the Federal Open Market Committee may cut interest rates to ensure economic growth, dealers said.

At 4.06 pm, 10-year notes were up 25/32 yielding 4.29%, hitting a new low, while 30-year bonds were up 1-13/32 yielding 5.21%. The two-year notes were up 7/32 yielding 2.00%, the lowest yield ever.