Foreign central banks will continue to buy Treasuries, so I am a little bullish. Yields may drop below 4.30 percent in the short-term.

This is a good level to buy Treasuries. We're looking for opportunities to extend the duration of our holdings by buying longer-term notes.

Ten-year Treasuries are very close to the yield level at which we plan to buy. We prefer the 10-year notes to shorter-term Treasuries because inflation is less of a concern compared to rising interest rates.

We are planning to buy Treasuries and the consumer price report reinforced our views that U.S. notes will rally. With the Fed likely to raise rates again, that will keep inflation well contained.