The Long-Term Treasury Bond futures are being launched in response to strong customer demand for a contract that mimics the duration of a 30-year Treasury bond
," said Robin Ross, CME Group Managing Director of Interest Rate Products.
Use of the 30-year Treasury bond
(no longer issued), which had been used as the basis for calculations for many years, proved to be a problem when long-term rates plunged in recent years.
For a two-year timeframe, the legislation will replace the 30-year Treasury bond
rate with a rate based on long-term corporate bonds.
The bill would provide a short-term, two-year pension funding fix to replace the current 30-year Treasury bond
interest rate that is used by many employers to calculate the amount of money they must set aside in their employee pension plans with a conservative corporate bond rate for two years through 2005.
8 without taking final action to replace the current 30-year Treasury bond
interest rate as the rate employers must use to calculate employee pension plan liabilities.
ERISA requires employers to use a variation of the 30-year Treasury bond
rate for these calculations; however, in 2001 Treasury stopped issuing the 30-year bond.
With all the drama and finality that the prestigious Wall Street Journal could muster, it declared this past May 3 that the reign of the 30-year Treasury bond
as the benchmark for pricing fixed-income securities in the $14.
Short rates may move higher if the Fed keeps tightening while long-term bonds may stay in a trading range," with the yield on the 30-year Treasury bond
likely to fluctuate between 5.
Breaking news today is that the 30-year Treasury bond
, which has not been issued since October 2001, might return.
While chair of CBF, Netzel lobbied against pegging the discount rate for defined benefit pension plans to the 30-year treasury bond
Replacing the 30-year Treasury bond
rate with a rate based on a high- quality composite corporate bond rate has been thoroughly analyzed and enjoys bipartisan support from key members of Congress, plan sponsors and employee organizations.
The 30-year Treasury bond
slipped 5/8 point to yield 5.