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The Economic Waterfront Has Suddenly Calmed

After the recent excitement in the bond market, things were a little calmer Friday. Dull, even.

"It's been boring," says Dana Johnson, head of capital markets research at

First Chicago Capital Markets

. "There were no economic releases, the Fed policy makers didn't say anything new. It was a quiet and almost featureless day."

What about the market's tone?

"There was no tone," says Johnson. "You're really reaching to make any fundamental comments about today's trading."

"It's like studying the plains of Nebraska," adds Fred Sturm, senior economist at

Fuji Securities

in Chicago. "There's not that much going on. There isn't going to be any government information flow to make the landscape more interesting until Thursday." That's when August

Durable Goods

and

Existing Homes

come out.

Nevertheless, the long bond was able to creep up another 9/32 to 99 29/32, taking the yield down to 6.38%.

"The market's bullish but a little hesitant," says Marilyn Schaja, money market economist at

Donaldson Lufkin & Jenrette

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. "There's a little nervousness going into next month."

That's when economists will begin to get a read on growth in the third quarter. Most people think that the Fed will base any decision on whether or not it should tighten before the end of the year on third-quarter data. "I think that they're going to be able to get away without tightening," says Schaja, who thinks that there's still head room for the 30-year bond. "The long end of the market could be a bit better," she says. "The short end should be a bit anchored because the Fed will not ease policy."

Sunday's events

(all times EDT):

Federal Reserve official speech (7:30 p.m.)

: Alice Rivlin, the moderate and politically astute

Federal Reserve Vice Chairman

, speaks to the

Institute of International Bankers

in Hong Kong.

Monday's numbers

:

CNW Auto Sales Trak

for Sept. 11-20 (10 a.m.)

Federal Reserve official speech

(Noon): Jerry Jordan, the moderate president of the

Cleveland Federal Reserve

speaks to the

Cleveland Business Economists Club

on monetary policy.

Treasury auction

(1 p.m.): The world's biggest borrower looks for $15 billion in three- and six-month bills to replace the $15.5 billion maturing.

Federal Budget

for August (2 p.m.): Consensus estimate is for a decline of $37.4 billion, according to

Reuters

.