* Traders focus on weak details in June jobs report
* Some economists now see earlier Fed rate hike
* U.S. to sell $61 bln coupon-bearing debt this week
* Fed buys $2.774 bln Treasuries due 2021-2024
(Updates market action, adds quote)
By Richard Leong
NEW YORK, July 7 Longer-dated U.S. Treasuries
yields fell on Monday on buying supported by the view that the
recent acceleration in job gains is not enough to spur the
Federal Reserve to raise short-term interest rates earlier than
While Thursday's government payrolls report showed a robust
288,000 increase in hiring in June and the jobless rate fell to
a six-year low at 6.1 percent, some traders were not convinced
the labor market is strong enough for Fed Chair Janet Yellen and
other policymakers to tighten policy sooner. The historically
low worker participation rate and a slow rate of wage growth
will likely restrain consumer spending, which accounts for
two-thirds of the U.S. economy.
"The data haven't been strong enough to change Yellen's
approach," said Jason Rogan, managing director of Treasuries
trading at Guggenheim Partners in New York.
This labor backdrop together with relatively muted inflation
should allow Fed policymakers to leave U.S. short-term rates
near zero at least into the second half of 2015, analysts said.
Benchmark Treasuries yields initially had jumped to
two-month peaks early Thursday on the June jobs data before
ending the session mildly higher on doubts whether the Fed would
push up its timing for a rate hike.
Economists at JPMorgan and Goldman Sachs changed their
forecasts for such a move to the third quarter of 2015 from the
fourth quarter of 2015 and first quarter of 2016, respectively.
The U.S. bond market was closed on Friday for the U.S.
Independence Day holiday.
On the open market, the yield on 10-year Treasuries notes
was last at 2.617 percent, 3 basis points lower than
Thursday when it traded as high as 2.692 percent.
The 30-year yield ended 4 basis points lower at
While overseas demand emerged to help push longer-dated
yields lower, shorter-dated yields hovered close to their
Thursday's closing levels with two-year yields near
their nine-month high at 0.516 percent.
Expected foreign appetite for higher-yielding U.S. bonds,
analysts say, should stoke bids for this week's $61 billion
worth of fixed-rate Treasuries supply: $27 billion in three-year
notes on Tuesday ; $21 billion in 10-year debt on
Wednesday and $13 billion in 30-year bonds on
"This will put a cap on how high Treasuries yields will go,"
said Larry Milstein, head of government and agency trading at
R.W. Pressprich & Co in New York.
While it remains uncertain when the Fed will raise interest
rates, it is widely expected the Fed will stop its third round
of quantitative easing before year-end. On Monday, it bought
$2.774 billion of Treasuries due in 2022 to 2024.
(Reporting by Richard Leong; Editing by Chizu Nomiyama and Nick