March 23, 2017 / 6:55 PM / 3 years ago

TREASURIES-Bonds weaken before vote on U.S. healthcare law

 (Adds quote, auction result, updates prices)
    * House healthcare vote in focus
    * Fed's Yellen doesn't address monetary policy
    * Treasury sells $11 bln, 10-year TIPS

    By Karen Brettell
    NEW YORK, March 23 (Reuters) - U.S. Treasury prices fell on
Thursday as investors waited for a vote by lawmakers on a bill
to replace the Obamacare healthcare law, which is seen as a
gauge of the Trump administration’s ability to implement
near-term goals.
    President Donald Trump made a final push on Thursday to win
over skeptical members of his own Republican Party to begin
dismantling Obamacare in the House of Representatives or risk
failure on one of his top legislative priorities.             
    Delays in passing domestic legislation, including
healthcare, are seen as likely to push back any new fiscal
stimulus, which investors had anticipated would boost growth and
possibly lead to faster than previously expected interest rate
    "There’s a lot riding on Republicans to get it passed, and
if they can’t get it passed, the market is going to assume that
it’s going to be very difficult to get anything else of Trump’s
agenda through," said Mary Ann Hurley, vice president in fixed
income trading at D.A. Davidson in Seattle.
    Concerns about delays in fiscal reform helped send stocks
lower this week while increasing demand for safe-haven bonds.
    Benchmark 10-year notes             were last down 7/32 in
price to yield 2.42 percent.
    The 10-year yields fell to 2.375 percent on Wednesday, their
lowest since Feb. 28. They are down from a three-month high of
2.63 percent on March 14.
    Investors have lowered expectations of a more aggressive
Federal Reserve as doubts about the pace of change in Washington
    The U.S. central bank raised interest rates last week as
expected but took a more dovish tone on future hikes than some
investors had anticipated.
    Investors who held back from taking new positions before the
Fed meeting have also returned to the market since the rate
hike, helping bonds rally.
    “Money was sidelined waiting for the Fed to hike rates,”
said Dan Mulholland, head of Treasuries trading at Credit
Agricole in New York. "Then once they did, we saw a bit of money
come into the market."
    Fed Chair Janet Yellen did not address monetary policy or
the economic outlook in prepared remarks for a childhood
education conference in Washington on Thursday.             
    Fed speakers on Friday include St. Louis Fed President James
Bullard, San Francisco Fed President John Williams, Chicago Fed
President Charles Evans and New York Fed President William
    Durable goods data and manufacturing data on Friday will
also be in focus.
    The Treasury Department sold $11 billion in 10-year Treasury
Inflation-Protected Securities on Thursday at a high yield of
0.466 percent.             

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below