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As a result, the yield of the U.S. 10-year Treasury note, the benchmark for all bonds public and private, is at 2.96 percent, almost double the 1.63 percent yield from early May. There was talk among investors that the recent rise in interest rates might have pushed Verizon to do its deal with Vodafone, in order to lock in these rates before the Fed starts to phase out its bond buying. While demand for bonds may have slowed broadly, demand for corporate bonds has remained steady, Prudential's Collins said. Verizon's bond sale is likely to spur more companies to issue debt, particularly if demand for Verizon's bonds stays high. For example, the biggest part of Verizon's offering was $15 billion in 30-year bonds, which had a yield of 6.55 percent, a higher yield than some significantly more risky junk bonds. "If yields remain high, there's going to be strong demand for corporate bonds from a variety investors
- from pension funds to insurance companies, and eventually retail investors," Collins said.
[Associated
Press;
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