TREASURIES-Bond prices pare gains after Bernanke, homes

NEW YORK, Feb 27 (Reuters) - U.S. government bond prices pared gains on Wednesday after Federal Reserve Chairman Ben Bernanke's initial remarks in testimony and after a U.S. new home sales report.

Bernanke said the Fed would act in a timely manner to support economic growth. Traders said the expectation of more Fed interest rate cuts was exacerbating the bond market's worries about inflation and weighing on longer maturities' prices.

The benchmark 10-year note's price -- which moves inversely to its yield -- came off its highs but was still up 3/32 for a yield of 3.85 percent US10YT=RR, compared with 3.86 percent late on Tuesday. (Reporting by John Parry; Editing by Theodore d'Afflisio)