LONDON Jan 24 U.S. government bond prices rose
on Thursday, as investors sought safe havens due to concerns
about potential automatic spending cuts in the world's top
economy and weak French data.
* A Republican plan to extend the U.S. Treasury's borrowing
authority will allow it to borrow money through mid-May,
temporarily easing default concerns, which have recently caused
a sell-off in U.S. T-bills but supported longer-term notes.
* But after the plan's approval on Wednesday in the House of
Representatives, speaker John Boehner said Republicans would
take the next opportunity - automatic spending cuts set for
March 1 - to demand reforms from President Barack Obama.
* "Tensions are ongoing and this may be one of the factors
playing in today," said Alan McQuaid, chief economist at Merrion
Stockbrokers. "But I think they'll kick the can down the road in
the end and eventually come to a solution."
* U.S. 10-year T-note yields were 1.4 basis
points lower to 1.8136 percent. T-note futures were last
11/64 higher at 132-15/32.
* U.S. yields fell in tandem with those of triple-A rated
German Bunds early in the European session, after data showed
French business activity shrank in January to the lowest level
since March 2009.
* McQuaid said North Korean plans to carry out further
rocket launches and a nuclear test that would target the United
States was also giving a bid to safe-havens.