* Intermediate maturities among gainers
* Jobs data soothes inflation worries
* Strategist sees little pressure for early rate hikes
(Adds late prices, quotes)
By Michael Connor
NEW YORK, Aug 4 U.S. Treasuries prices edged up
on Monday amid receding investor worries over an
earlier-than-expected interest-rate hike by Federal Reserve
Treasuries had rallied on Friday, when U.S. employment data
for July showed flat wage gains for hourly workers and a rise in
the national unemployment rate to 6.2 percent.
The data calmed fears about inflation, which could spur
higher interest rates and lower bond prices.
On Monday, prices rose for both intermediate and long
maturities, with 3-year to 7-year maturities at center stage,
according to Jake Lowery, portfolio manager at Voya Investment
Management in Atlanta.
"Intermediate maturity Treasuries continue to rally as a
follow-up to Friday, when they did the same. The market seems
comfortable with the Fed statement last week and the uptick in
unemployment," Lowery said. "We are likely to stay in a low
volatility environment for some time."
Most of Wall Street's top bond firms see no move by the Fed
to increase interest rates from historic lows before the second
half of next year, a Reuters poll showed on Friday.
Fed policymakers are under little pressure to bring rate
raises forward because the U.S. economy is growing moderately
and Europe is battling high unemployment and slow growth,
according to Robert Tipp, chief investment strategist at
Newark-based Prudential Fixed Income.
"The euro zone is in the situation that the U.S. was in 2008
or 2009," Tripp said. "The European Central Bank is going to be
standing on the accelerator with both feet for at least the next
two or three years trying to get growth to speed up. If their
(interest rate) cost is extremely low, that is going to exert
some gravitational pull on U.S. rates."
German 10-year bunds yield about 1.14 percent, while 10-year
Treasuries pay out more than double that at nearly 2.5 percent,
In late New York trading, benchmark 10-year notes
were last up 5/32 in price to yield 2.49 percent,
down from 2.495 percent at Friday's close. The 30-year
was up 3/32 to yield 3.29 percent.
Among intermediate maturities, the 7-year was
ahead 4/32 and yielding 2.14 percent, down from 2.15 percent at
the close on Friday.
Investor buying patterns are shifting, with some demand
leaving the market's long end, Lowery said. The buying had
narrowed the differences among Treasuries maturities.
"Over the last couple of months, the curve has flattened
relentlessly, with the 30 generally outperforming the rest of
the curve," he said. "That's based on some strong demand that
the market has been seeing from foreign central banks, as well
as some large money managers. Buying from those sources seems to
have slowed down in the past week or so."
(Reporting By Michael Connor in New York; Editing by Bernadette
Baum and Meredith Mazzilli)