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TREASURIES-Bonds gain as concerns about Washington gridlock grow
March 22, 2017 / 1:07 PM / 6 months ago

TREASURIES-Bonds gain as concerns about Washington gridlock grow

    * Stock jitters boost demand for bonds
    * Investors focusing on Washington reforms

    By Karen Brettell
    NEW YORK, March 22 (Reuters) - U.S. Treasury yields fell to
three-week lows on Wednesday as concerns about delays in passing
Washington fiscal reforms weighed on stock markets and increased
demand for safe-haven bonds.
    U.S. stock index futures were lower on Wednesday, a day
after Wall Street posted its biggest one-day fall since the
November election.             
    Analysts attributed the market moves to reduced confidence
that U.S. President Donald Trump's pro-growth policies would be
implemented soon.
    “People are losing confidence in a swift moving set of
congressional reform,” said Ian Lyngen, head of U.S. rates
strategy at BMO Capital Markets in New York.
    Trump is facing opposition from lawmakers on his plan to
dismantle Obamacare, with any new fiscal stimulus likely to be
delayed as the administration prioritizes domestic issues
including healthcare.             
    Benchmark 10-year notes             were last up 8/32 in
price to yield 2.41 percent, down from 2.43 percent on Tuesday.
    The yields fell to 2.396 percent in overnight trading, the
lowest since February 28. The notes have technical resistance at
around 2.40 percent.
    Speeches by Federal Reserve officials are also in focus this
week for any new indications about future interest rate policy.
    Fed Chair Janet Yellen is due to speak at a community
development conference on Thursday.
    Expectations of a less aggressive Fed have added to bond
gains this week.
    Yields have fallen since the U.S. central bank last
Wednesday raised interest rates, as expected. Some investors had
anticipated the Fed would also take a more hawkish tone on
future rate hikes on expectations of stronger growth.

 (Editing by Nick Zieminski)
  
 
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