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UPDATE 1-Speculators add bearish U.S. 10-year note futures bets
December 6, 2013 / 9:38 PM / 4 years ago

UPDATE 1-Speculators add bearish U.S. 10-year note futures bets

NEW YORK, Dec 6 (Reuters) - Speculators increased their net bearish bets on U.S. 10-year Treasury note futures in the latest week ahead of key November jobs data, according to Commodity Futures Trading Commission data released on Friday.

The amount of speculators’ bearish, or short, positions in 10-year Treasury futures exceeded bullish, or long, positions by 167,360 contracts on Dec. 3, according to the CFTC’s latest Commitments of Traders data.

Speculators bet that 10-year note prices would fall ahead of possibly stronger-than-expected data on jobs.

That labor market data, released earlier on Friday, did indeed beat expectations, sending yields to three-month highs in choppy trading.

A week earlier, speculators held 155,554 net short positions in 10-year T-note futures.

A stronger labor market - and a stronger economy - could prompt the U.S. Federal Reserve eventually to curb its quantitative easing program, in which the bank buys $85 billion per month in Treasuries and mortgage-backed securities.

But speculators also turned more bullish on shorter-dated U.S. government debt futures. The Fed is expected to keep short-term interest rates ultra-low for an extended period to help prop up the world’s biggest economy.

Speculators’ long positions in two-year T-note futures exceeded shorts by 62,144 contracts on Dec. 3, up 9,054 from the previous week.

In five-year Treasury note futures, speculators had a net long position of 29,353 contracts, up 11,146 from the previous week.

Speculators added to net long in 30-year bond futures by 12,713 contracts, for a total net long position of 21,650 contracts, according to the latest CFTC Commitments of Traders figures.

In ultra-long T-bond futures, however, speculators increased their net shorts. Their shorts in the ultra bond futures exceeded longs by 6,643 on Dec. 3, compared with a net short of 6,211 contracts the previous week.

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