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To: accountclosed who wrote (20828)	2/22/1999 12:49:00 PM
From: John Pitera	Read Replies (1) \| Respond to of 86076

AR, That a yes on Tuesday for Greenspan Monday February 22, 12:30 pm Eastern Time (Note: this article is "in progress"; there will likely be an update soon.) US Treasuries up at midday as Greenspan awaited By Ellen Freilich NEW YORK, Feb 22 (Reuters) - U.S. Treasury prices were higher at midday on Monday on optimism that Federal Reserve Chairman Alan Greenspan's Humphrey-Hawkins Congressional testimony on Tuesday will be evenly balanced, analysts said. "After the CPI last week, there's more of a feeling that Greenspan will be neutral in his comments tomorrow and neutral would be fine for the market because it has already removed the possibility of easing," said Henry Willmore, senior economist at Barclays Capital. At noon EST/1700 GMT, the benchmark 30-year Treasury bond was up 12/32 to 98-11/32, yielding 5.36 percent. Willmore said if the Fed chairman would indicate in some way that the Fed is likely to hold policy steady for the next half year, "that would be a small plus" for bond prices because the market has been thinking that a tightening farther down the road is possible. Participants noted that bond prices had improved despite the fact that dollar/yen was off its highs and the U.S. stock market was rallying. "There's a sense that Greenspan will be fairly benign for the market," said a governments trader at a primary dealer. "Some deals are getting done." "Greenspan ought to be fairly benign for the market," agreed Larry Dyer, governments strategist at Credit Suisse First Boston. "The market is bouncing," said Chris Rupkey, vice president and financial economist at Bank of Tokyo/Mitsubishi. "It reached levels that seem attractive and people are wading back in. They think Greenspan could be neutral for the market." Rupkey said participants at first had feared that Greenspan's testimony would lean toward hawkishness, that he might talk about areas of concern like tight labor markets. "But now people seem to think that yields are back up enough that risk/reward-wise, it pays to get in," he said. He said the curve could steepen a little. Rupkey said the market's ability to move higher despite the strong stock market might mean that the strong equity performance is keeping the lid on a potential bond rally. "Maybe we'd be much higher" if it weren't for the strength in stocks, Rupkey said. (Note: this article is "in progress"; there will likely be an update soon.)