In early trade, 10-year benchmark price was up 6/32 at 100 even, yielding 6.50 per cent.

At the same time, the June T-bond future price was up 4/32 at 93-20, while June 10-year note futures were up 3/32 at 95-11.5.

Analysts said most participants remained sidelined before Tuesday's Fed meeting, with the small gains constituting a bounce from Friday's sell-off. ``We saw some light buying in London out of Asia, but it was pretty dull overnight,'' said Gib Clark, trader at Zions First National Bank Capital Markets. ``The focus is on tomorrow's CPI (Consumer Price Index) release and today it's industrial production,'' he said. ``I suppose we don't give a hoot about the industrial production report unless it's way up or way down, but really everyone is just focusing on the Fed meeting.''

The market will get two substantial economic reports before Fed officials deliberate on their next monetary policy move on Tuesday.

Economists polled by Reuters estimated, on average, that the Fed's industrial production and capacity utilisation data would show a 0.7 per cent rise in April production versus a 0.7 per cent increase in March and a reading of 81.8 per cent for capacity utilisation, up slightly from 81.4 per cent in March.

``Everyone's waiting for the Fed and the CPI before that,'' said a trader at a primary dealer.

The Fed's rate decision will be announced around 2:15 pm (1815 GMT) on Tuesday.

A Reuters poll conducted on Friday showed Wall Street believes that the Fed will raise interest rates by 50 basis points at its Tuesday policy meeting and that a growing number of investment firms expects the federal funds rate, now at 6 per cent, to rise to at least 7 per cent by year-end.

The April CPI will be released at 8:30 am (1230 GMT) on Tuesday. Economists surveyed by Reuters predicted, on average, that the CPI rose 0.1 per cent in April compared to 0.7 per cent the previous month. The core rate, which excludes food and energy, is estimated to have risen by 0.2 per cent. An unexpectedly low core CPI could raise the thought in some people's minds that the Fed might raise interest rates by just 25 basis points, instead of 50.

-- (Reuters)