The rate-indicative 10-year Treasury yield has fallen below the psychologically important 4% level, according to Yahoo! Finance.Bear Stearns researchers said the decline in the benchmark yield for long-term rates resulted in part from the Federal Open Market Committee's decision Sept. 21 to raise the target short-term federal funds rate and accompanying comments by the committee indicating that inflationary pressures appeared to have diminished somewhat. "The market seems to be emphasizing the potential economic impact of Fed funds, with a drop in funds pushing inflation risk up and a boost in funds bringing it down," Bear Stearns' financial analytics and structured transactions researchers said in a recent report.

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