T-Bond Futures Gain Limit

Treasury bond futures prices advanced the limit for daily trading Monday on reports from the Tokyo economic summit that could mean lower interest rates.

Finance ministers of major Western nations reportedly agreed to a combined effort to bring interest rates down

“So apparently the United States has had some success in getting the Japanese and Germans to agree to get their economies going by . . . cutting interest rates,” said Jack Barbanel, an analyst in New York with Gruntal & Co.

Central banks of major countries have staged two rounds of rate cuts since the first of the year.

“Certainly we’re going to need” a rate cut in the United States, Barbanel said. “But the only way we could justify one with the dollar as weak as it is would be if the Germans and Japanese” went along. Bond futures were strong even before the interest rate reports, because of continuing signs that the U.S. economy is still weak and on the belief that the government auction of securities this week will attract good prices.