April 23, 2020 / 1:44 PM / 2 months ago

TREASURIES-Investors look past grim U.S. jobless claims report, keep yields steady

    By Ross Kerber
    BOSTON, April 23 (Reuters) - U.S. Treasury yields were
little changed on Thursday as investors set aside the latest
grim jobs report to focus on how quickly the U.S. economy might
reopen amid the coronavirus pandemic.
    The benchmark 10-year yield was less than a
basis point higher at 0.6282%.
    That was even though the Labor Department said 4.427 million
more people applied for unemployment benefits for the first time
last week, bringing the number of Americans seeking unemployment
benefits over the past five weeks to a record 26 million
people.
    Traditionally such poor data would lead investors to buy
safety assets like government bonds, driving down their yields.
    But amid the broad economic collapse brought on by the
outbreak, investors are much more focused on questions like the
strength of measures taken by officials toward reopening
businesses, like effective testing and medicines, said Priya
Misra, head of global rates strategy for TD Securities.
    "The market is ignoring all the weak data so far, it's
priced in," Misra said. "We have moved ahead from the second
quarter being awful, it's the third and fourth quarter outlook"
on which investors are focused, she said.
    Hundreds of members of the U.S. House of Representatives
will gather in Washington on Thursday to pass a $484 billion
coronavirus relief bill, bringing the unprecedented total of
funds approved for the crisis to nearly $3 trillion.{nL2N2CB0I9]
    A closely watched part of the U.S. Treasury yield curve
measuring the gap between yields on two- and 10-year Treasury
notes, seen as an indicator of economic
expectations, was at 40 basis points, about 4 basis points
higher than at Wednesday's close.
    The two-year  U.S. Treasury yield, which
typically moves in step with interest rate expectations, was up
1.2 basis points at 0.2231% in morning trading.
    
      April 23 Thursday 9:16AM New York / 1316 GMT
                               Price                  
 US T BONDS JUN0               181-1/32     0-2/32    
 10YR TNotes JUN0              138-232/256  -0-36/25  
                                            6         
                               Price        Current   Net
                                            Yield %   Change
                                                      (bps)
 Three-month bills             0.1125       0.1144    0.010
 Six-month bills               0.14         0.142     0.000
 Two-year note                 100-75/256   0.2231    0.012
 Three-year note               99-238/256   0.2737    0.016
 Five-year note                100-144/256  0.3848    0.021
 Seven-year note               100-168/256  0.5285    0.016
 10-year note                  108-72/256   0.6282    0.009
 30-year bond                  119-184/256  1.2101    -0.010
                                                      
   DOLLAR SWAP SPREADS                                
                               Last (bps)   Net       
                                            Change    
                                            (bps)     
 U.S. 2-year dollar swap        17.50        -1.25    
 spread                                               
 U.S. 3-year dollar swap        11.50        -1.25    
 spread                                               
 U.S. 5-year dollar swap         7.50        -1.75    
 spread                                               
 U.S. 10-year dollar swap        3.50        -1.25    
 spread                                               
 U.S. 30-year dollar swap      -40.25        -1.00    
 spread                                               
 

 (Reporting by Ross Kerber in Boston)
  
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