TREASURIES-1-month Treasury yields tumble ahead of possible debt ceiling vote; 10-year yield flat

Kitco Media
By Reuters
Published:
Updated:
Reuters
By David Randall NEW YORK, April 26 (Reuters) - One-month Treasury yields tumbled ahead of a possible vote on the U.S. debt ceiling while longer duration yields were largely unchanged Wednesday as investors weighed strong earnings results with signs that business spending is slowing.


Yields of the one-month Treasury bill fell more than 20 basis points to 3.79%, bringing it back below 4% after spiking higher Tuesday. The security, which is often seen as a proxy for cash, could be among the most affected by a continued standoff over raising the U.S. borrowing limit.


The U.S. House of Representatives may vote on a bill that would sharply cut spending in exchange for a short-term increase in the debt ceiling on Wednesday.


The yield on 10-year Treasury notes was down 0.2 basis point to 3.396%, while the yield on the 30-year Treasury bond was down 0.1 basis point to 3.651%.


Bond yields move in the opposite direction of prices.


New orders for key U.S.-manufactured capital goods fell 0.4% in March., more than the 0.1% expected by economists polled by Reuters, while data for February was revised downward to show a 0.7% decline, rather than the previous estimate of a 0.1% decline, the Commerce Department said.


U.S. stocks broadly rose Wednesday following strong forecasts from bellwethers including Microsoft Corp and Boeing Co .


"The economy still has residual strength despite a raft of reports indicating an advancing slowdown," said Quincy Krosby, Chief Global Strategist for LPL Financial.


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 -49.9 basis points.


April 26 Wednesday 9:44AM New York / 1344 GMT Price Current Net Yield % Change (bps) Three-month bills 4.9775 5.1109 -0.009 Six-month bills 4.77 4.9693 -0.006 Two-year note 99-247/256 3.8934 -0.003 Three-year note 100-82/256 3.6348 -0.005 Five-year note 100-210/256 3.4421 -0.002 Seven-year note 101-68/256 3.4179 -0.003 10-year note 100-216/256 3.3977 0.000 20-year bond 101-120/256 3.7688 0.001 30-year bond 99-136/256 3.6507 -0.001
DOLLAR SWAP SPREADS


Last (bps) Net


Change


(bps)
U.S. 2-year dollar swap 31.50 6.00
spread
U.S. 3-year dollar swap 18.25 1.00
spread
U.S. 5-year dollar swap 7.00 0.00
spread
U.S. 10-year dollar swap -0.75 -0.25
spread
U.S. 30-year dollar swap -42.00 0.00
spread



(Reporting by David Randall; editing by Jonathan Oatis)

Messaging: david.randall.thomsonreuters.com@reuters.net))
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