Treasury Bond Futures Soar

Treasury bond futures soared Tuesday on the Chicago Board of Trade following remarks by the chairman of the Federal Reserve Board that interest rates should be lower.

The move in Treasury bond futures, which move inversely to interest rates, appeared to be spurred by remarks made by Paul A. Volcker, chairman of the Fed, said Steve Chronowitz, director of research in New York with Smith Barney, Harris Upham & Co.

Volcker, speaking in Canada, said that the Fed has maintained a “relatively accommodative monetary policy” but that “interest rates remain high historically.”

Chronowitz said the financial markets have “a general perception that the Federal Reserve wants interest rates lower.”

Coffee prices retreated following an explosive rally on the Coffee Sugar and Cocoa Exchange in New York.

Analysts said some of the selling was generated by talk of rainfall in Brazil, where a drought has damaged the coffee crop.

Grain and soybean futures prices were mostly higher on the Chicago Board of Trade.

Livestock and meat prices were mostly lower on the Chicago Mercantile Exchange.