TREASURIES-Bonds steady, taking cue from overnight stabilisation
TOKYO, June 25
TOKYO, June 25 (Reuters) - U.S. Treasuries prices held steady in Asia on Tuesday after bouncing back overnight with the benchmark 10-year yield falling from a near two-year high, although investors remained cautious about the Federal Reserve's plan to start rolling back its stimulus.
* The yield on 10-year notes stood at 2.5442 percent, holding steady from U.S. trade of 2.54 percent. The benchmark yield rose as high as 2.667 percent, the highest since August 2011, in overnight U.S. trade.
* "We think eventually U.S. yields may go up more. But at this point the move was so rapid from 2.2 percent to 2.6 percent that it's getting to a point maybe that we are going to be stabilising from here. In my opinion, it may go lower depending on the situation," said Tadashi Matsukawa, head of Japan fixed income at PineBridge Investments.
* Fed Chairman Bernanke rattled investors last week when he said the U.S. central bank may reduce its bond purchases of $85 billion a month in Treasuries and mortgage-backed securities starting later this year.
* "We are not going to go straight up to 3 percent, or 4 percent," Matsukawa said. "The economy is not very strong yet. That's not only China, not only emerging markets but globally Europe, Japan and U.S. itself. Inflation is not accelerating at all. If (U.S.) interest rates continue to rise, it will kill the housing market."
* The yield on 30-year notes was at 3.5538 percent, compared with 3.56 percent in U.S. trade on Monday.
- Gaza fighting abates as diplomatic tension flares |
- Hague court orders Russia to pay $50 billion in Yukos case
- Pushing locals aside, Russians take top rebel posts in east Ukraine
- Europe subdued, Russia shares tumble on new sanctions
- Fighting complicates Ukraine crash probe, U.S., EU prepare Russia sanctions |