TOKYO, April 3 U.S. Treasuries steadied in Asia
on Wednesday, after slipping the previous day as worries of a
major banking crisis in the euro zone receded and as investors
braced for a solid recovery in U.S. employment.
* The yield on the 10-year notes was little changed at 1.861
percent. It rose about 3 basis points on Tuesday
after hitting a two-month low of 1.823 percent in Asian trade.
* Although weak U.S. manufacturing data on Monday helped to
drive down the 10-year yield to a two-month low, stable euro
zone debt markets boosted investors' risk appetite.
* Italian and Spanish bond prices rose as investors scaled
back concerns that a draconian international bailout of Cyprus
could set off a wider bank run in the euro zone.
* Wall Street shares also rallied to record highs, with both
the S&P 500 and Dow Jones index closing at record
highs, undermining the attraction of Treasuries.
* Furthermore, investors are expecting Friday's U.S. jobs
data, the most important event of the week, to show payrolls
gained a net 200,000 in March, well above its trend since the
U.S. economy recovered from the 2008 financial crisis.
* Still, Treasuries were underpinned by expectations the
Federal Reserve will keep buying bonds for the time being to
knock down unemployment further.
* "U.S. bond yields also look attractive, comparatively
speaking, as yields on Japanese and German bonds are falling
sharply," said a trader at a Japanese bank.
* The 10-year Japanese government bond yield is flirting
with 10-year lows near 0.5 percent on hopes of aggressive
monetary easing by the Bank of Japan. German Bunds yield about
1.31 percent, not far from its eight-month low
near 1.25 percent hit last week on worries about Cyprus.