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TREASURIES-US bonds edge down in Asia but Europe woes support
April 11, 2012 / 5:57 AM / 5 years ago

TREASURIES-US bonds edge down in Asia but Europe woes support

TOKYO, April 11 (Reuters) - U.S. Treasuries edged down in Asia on Wednesday, taking a breather from an overnight rally but supported by heightened concerns on Europe’s debt woes and their impact on global growth.

* Fears that some European countries will have trouble servicing their debt resurfaced after Spanish 10-year bond yields climbed to nearly 6 percent on Tuesday.

* Worries on Europe added to last week’s weak U.S. jobs report, which raised questions about the strength of the U.S. economic recovery, and helped drive Treasury yields to four-week lows on Tuesday.

* “The speed of the move (in Treasuries) was so quick. We will be watching to see if Spanish yields stop rising today, and taking our cue from that,” said a market participant at a Japanese bank.

“We thought that once Greece’s bailout package was in place, we could turn our attention to the progress of the U.S. recovery and whether the Federal Reserve would further ease, but we have returned to focusing on Europe, with its debt problems appearing to be far from over.”

* The yield on the 10-year notes rose to 2.00 percent from 1.984 percent in late U.S. trade, but still below 2.05 percent in Asian trade on Tuesday.

* The 30-year bond yield advanced to 3.15 percent from 3.13 percent in U.S. trading. It was at 3.20 percent in Asia on Tuesday.

* In a bullish signal for Treasuries, both 10-year and 30-year bond yields have pulled solidly below their 200-day moving averages, now at 2.17 percent and 3.31 percent respectively.

* Later on Wednesday, the U.S. Treasury will sell $21 billion of reopened 10-year notes, followed by $13 billion of reopened 30-year bonds on Thursday.

* A U.S. government auction of three-year Treasury notes on Tuesday attracted the highest proportion of indirect bidders, considered a measure of overseas interest, since August 2011, suggesting that investors around the world have a strong appetite for the perceived safe-haven of U.S. government debt.

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