The Treasury market is trading in a tight range in a slow, methodical morning. Early on, the best performance came from the intermediate part of the curve -- five-year and 10-year notes. There's been little reaction to overnight air raids on Belgrade and other Serbian targets by


, possibly because information about the conflict is limited.

Lately the 30-year Treasury bond was down 3/32 to 95 24/32, yielding 5.54%. The June bond contract has traded in a tight six-tick range, and was lately at 121 15/32, up 4/32. The five-year lately was down 1/32, while the 10-year fell 4/32.

While economic data have continued to display strength, and there's a slight possibility that the

Federal Open Market Committee

will move to a tightening bias at next Tuesday's meeting, the forecast for March's


report looks market-friendly. Economists have forecast an 180,000 gain in new nonfarm payrolls for the report, to be released April 2.

Technical rallies supported the market during its mild upswing the last two weeks, even though volume remained extremely thin, so that's a mild positive. As of 10 a.m. EST,


volume was 16.7% lower than in the average first-quarter Thursday, with $23.1 billion of securities changing hands.

"The news coming forward next week is likely to be better for the market," said Tom Ruff, vice president in proprietary trading at

Daiwa Securities

. "It's well advertised, but the technicals will turn better next month in terms of pay downs, and we might get some index buying approaching the end of the month."

Conversely, it's difficult to refer to the weekly

jobless claims

report as "surprisingly low" anymore. For the week ended Saturday, claims totaled 289,000, and the four-week moving average fell to 292,000, just off the all-time low of 291,000, reached last month.

"I'm constructive, guardedly," said Ruff. "You can't be married to one position or another, at least currently."

Japanese bonds ended down 6.5 basis points to 1.885 yesterday. Despite a lack of interest in the 10-year JGB auction, the market supported the new bond in secondary trading, the

Nihon Keizei Shimbun


Traders are holding out for renewed Japanese interest in the Treasury market once the fiscal year ends and repatriation of assets declines. During last April the Japanese bought $6.3 billion in notes and bonds, according to the

Treasury Department


But if 1999 is anything like last year, the bulk of repatriation took place in January. Japanese institutions sold about $6.5 billion in Treasury bonds and notes in January 1998; in February they bought about $764 million, and in March sold $168 million.