Meanwhile, prices of bills and shorter-term note were firm.

But, not surprisingly, the Fed's move to lower short-term interest rates helped to increase prices of shorter-term notes and bills.

The largest price decline was seen among shorter-term notes, securities that have rallied sharply for two weeks.

Traders said accounts were moving out of positions in shorter-term notes and into bonds.

But prices of shorter-term notes, which have fallen significantly in recent weeks, were little changed.

Once again, much of the demand centered on shorter-term notes and bills.

Prices of shorter-term notes and Treasury bills were little changed.

Traders said that demand for shorter-term notes and bills was strong for most of the day.

Most of the drop in prices yesterday was recorded among shorter-term notes and bills, issues that have been star performers over the last few weeks.

Analysts suggested the price movements of the last two days have pushed yields on shorter-term notes to very attractive levels.