LONDON Dec 28 U.S. government bond yields edged
down on Friday as investors preferred to hold safe haven assets
before a last-chance round of negotiations to avoid a fiscal
crisis next year.
* President Barack Obama and lawmakers plan another round of
talks before a New Year's deadline to prevent the economy from
facing a "fiscal cliff" of tax hikes and spending cuts that
economists fear could tip the United States back into recession.
* Lawmakers were divided on the odds of success, with a few
expressing hope, some talking as if they had abandoned it and a
small but growing number suggesting Congress might try to
stretch the deadline into the first two days of January.
* "(The fiscal cliff) is the only game in town," one trader
said. "They have a meeting today and nobody knows what's going
to happen ... so you have to stay reasonably risk averse."
* Ten-year T-note yields were last 1 basis point
lower at 1.7234 percent.
* Although thin volumes raised questions about the validity
of the signal, a dip below the 200-day moving average in 10-year
yields - last at 1.7450 percent - could point to further falls,
some traders said.