TOKYO, April 19 U.S. Treasuries held firm on
Friday after data on jobless claims and the mid-Atlantic
region's factory activity added to evidence of a slowdown in the
* "It's becoming clear that the U.S. economy is slowing
down. It has lost the momentum it had at the beginning of year.
People also expect the impact of automatic spending cuts to set
in from now," said Tomoaki Shishido, fixed income analyst at
* Initial claims for state unemployment benefits rose 4,000
to a seasonally adjusted 352,000, with its four-week moving
average for new claims, a better measure of labour market
trends, also rising 2,750 to 361,250.
* The Philadelphia Federal Reserve Bank said its business
activity index fell to 1.3 in April from 2.0 in March. A reading
above zero indicates expansion in the region's manufacturing.
* The yield on the 10-year notes stood at 1.701 percent
, rising slightly from 1.686 percent in late U.S.
trade in a knee-jerk reaction after risk asset prices gained on
comments from Japanese Finance Minister Taro Aso that he faced
no opposition to Japan's policy at the meeting of Group of 20
* Still, the yield stood not far from a four-month low of
1.673 percent hit earlier in the week on growing expectations
slower U.S growth is likely to mean the Federal Reserve will
keep its bond buying at the current pace.
* Indeed St. Louis Fed President James Bullard, seen as a
centrist on policy and a voting member of the Fed's policy
committee this year, said on Thursday the Federal Reserve should
buy bonds if inflation continues to fall.
* In a sign concerns about inflation is waning sharply
prices of Treasuries designed to protect investors from
inflation dived after a weak auction and as a spate of
disappointing economic data eased worries about inflation.
* The yield on the 10-year TIPS rose sharply
on Thursday to -0.576 percent on Thursday, driving down the
breakeven inflation -- the level of inflation investors expect
-- to 2.26 percent, its lowest level in more than seven months.