TREASURIES-Prices slip in Asia, pressured by upbeat China survey

TOKYO Fri Dec 14, 2012 12:18am EST

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TOKYO Dec 14 (Reuters) - U.S. Treasuries slipped in Asia on Friday, building on their U.S. losses as risk appetites improved on a Chinese manufacturing survey that raised optimism about that country's economy.

* The HSBC flash purchasing managers' index for December rose to 50.9, a 14-month high and the fifth straight monthly gain. Rises in areas such as new orders and employment underlined a brighter outlook for the economy in the coming months.

* "There are many reason to sell Treasuries, and not so many reasons to buy them, except for uncertainty that still surrounds the U.S. fiscal talks," said Hiroki Shimazu, an economist at SMBC Nikko Securities in Tokyo.

* President Barack Obama and House of Representatives Speaker John Boehner met on Thursday to attempt to resolve the stalemate over how to avoid the "fiscal cliff" of steep tax hikes and spending cuts.

* U.S. debt prices slid on Thursday after an auction of 30 year bonds met lacklustre demand.

On Wednesday, the U.S. Federal Reserve said it will buy $45 billion in Treasuries each month on top of the $40 billion per month of mortgage-backed bonds it started buying in September, and that it will expand its purchases to five-year notes from the current seven-, 10- and 30-year Treasuries.

Data on Thursday showing lower-than-expected claims for unemployment benefits also pressured debt prices.

* Yields on 10-year Treasuries rose to 1.736 percent on Friday in Asian trade, from 1.720 percent in late U.S. trade on Thursday.

* Yields on 30-year Treasuries rose to 2.913 percent from 2.899 percent on Thursday, while five-year yields rose to 0.700 from 0.681 percent.

* On the supply side next week, the Treasury will offer two-year, five-year and seven-year notes, as well as five-year Treasury inflation-protected securities.

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