* Traders anticipate hawkish Yellen stance Tuesday
* Concerns ease over Portugal's top bank
* Traders eye June retail sales data
(Updates prices, adds comments)
By Sam Forgione
NEW YORK, July 14 U.S. Treasuries prices edged
lower on Monday on expectations that Federal Reserve Chair Janet
Yellen could take a less accommodative stance on interest rates
in a congressional testimony on Tuesday.
Yellen, who will go before the Senate Banking Committee
Tuesday to deliver the latest report to Congress on monetary
policy, could take a hawkish stance on raising interest rates in
response to strong June jobs data, analysts and investors said.
"The data is definitely stronger and getting more indicative
that we're going to move closer to that rising rate cycle," said
George Rusnak, managing director of global fixed income for
Wells Fargo Private Bank in Princeton, New Jersey. "If you start
seeing any signs that they're acknowledging that in the Fed, you
could see rates tick up here a little bit."
Yellen is also set to speak before a House committee on
Wednesday. The Fed chief delivers testimony on monetary policy
twice a year to Senate and House committees.
Private-sector jobs and nonfarm payrolls growth in June beat
expectations, while the unemployment rate fell to a near
six-year low of 6.1 percent. Traders are watching the Fed
closely for signs of when the central bank will raise rates,
which will hurt bond prices.
Analysts said the installment of a new chief executive at
Portugal's top bank, Banco Espirito Santo, and a statement that
the bank's main shareholder had sold a 4.99 percent stake eased
concerns of potentially destabilizing losses at the bank.
"Banco Espirito Santo will have to get its house in order,"
said Justin Hoogendoorn, fixed income strategist at BMO Capital
Markets in Chicago. "The story is still unfolding, but the
immediate actions certainly calm fears for the day."
Analysts said June U.S. retail sales data, due early
Tuesday, could boost expectations for better second-quarter U.S.
economic growth. Economists expect retail sales to have grown
0.6 percent, up from 0.3 percent in May, according to a Reuters
Benchmark 10-year U.S. Treasury notes were last
down 6/32 in price to yield 2.54 percent, from a yield of 2.52
percent late Friday. U.S. 30-year Treasury bonds
were last down 11/32 to yield 3.36 percent, from a yield of 3.34
percent late Friday.
Comments from European Central Bank President Mario Draghi
had little effect on Treasuries prices. Draghi, addressing a
European Parliament committee in Strasbourg, reiterated that the
ECB would maintain a high degree of monetary accommodation and
could use unconventional instruments to counter low inflation.
The Fed bought $1.133 billion in Treasuries maturing August
2039- August 2043 on Monday as part of its ongoing asset
purchases, which had little impact on Treasuries prices.
On Wall Street, U.S. stocks rose, with better than expected
earnings from Citigroup and more deals in the healthcare space
lifting the Dow Jones industrial average to a new
(Reporting by Sam Forgione; Editing by Meredith Mazzilli and