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TREASURIES-Yields little changed as politics, U.S. jobs data eyed
April 6, 2017 / 3:06 PM / in 8 months

TREASURIES-Yields little changed as politics, U.S. jobs data eyed

    * U.S. 2-7 year yields about 3 bps above multi-week lows
    * Traders await Trump-Xi meeting, U.S. non-farm payrolls
data
    * Paul Ryan tax reform comments keep yields from rising

    By Sam Forgione
    NEW YORK, April 6 (Reuters) - U.S. Treasury yields were
little changed on Thursday amid uncertainty ahead of a key U.S.
jobs report Friday, a meeting between U.S. President Donald
Trump and Chinese President Xi Jinping, and over the fate of
Trump's pro-growth agenda.
    Yields on Treasuries maturing between 2-7 years hovered
about three basis points above multi-week lows touched earlier
in the week before the key events. The meeting between Trump and
Chinese President Xi Jinping Thursday will be their first, while
economists polled by Reuters expect U.S. employers to have added
180,000 jobs last month. 
    "There are certainly a lot of crosscurrents between politics
and the Fed, I think the market is unsure what to do at the
moment," said Gennadiy Goldberg, an interest rate strategist at
TD Securities in New York. "The market will be very remiss to do
anything too sharp at this point given that we have payrolls
coming up."
    Analysts said comments on Wednesday by U.S. House of
Representatives Speaker Paul Ryan stoked concerns over the
feasibility of Trump's agenda, in turn stoking a bid for
safe-haven U.S. government debt that prevented yields from
rising. 
    Ryan said tax reform would take longer to accomplish than
repealing and replacing the Affordable Care Act, known as
Obamacare, and that Congress and the White House were initially
closer to agreement on healthcare legislation than on tax
policy.
    "Ryan saying tax reform was going to potentially take
longer, that is pretty much just opening up the possibility that
the first 100 days of Trump's presidency is not going to see any
material actionable planning being done," said Stanley Sun,
interest rate strategist at Nomura Securities International in
New York.
    Traders also digested minutes from the Federal Reserve's
March meeting released Wednesday afternoon, which showed most
Fed policymakers think the central bank should take steps to
begin trimming its $4.5 trillion balance sheet later this year
as long as the economic data holds up.
    Benchmark 10-year Treasury notes were last up
1/32 in price to yield 2.353 percent, from a yield of 2.357
percent late Wednesday. U.S. 30-year Treasury bonds
were last down 3/32 in price to yield 3.009 percent, from a
yield of 3.005 percent late Wednesday. 
    U.S. three-year yields were last roughly flat at
1.45 percent after touching a more than five-week low of 1.426
percent Wednesday. 
    
    April 6 Thursday 10:48AM New York / 1448 GMT
                               Price                  
 US T BONDS JUN7               151-12/32    -0-4/32   
 10YR TNotes JUN7              125-24/256   0-12/256  
                               Price        Current   Net
                                            Yield %   Change
                                                      (bps)
 Three-month bills             0.7875       0.8       -0.003
 Six-month bills               0.91         0.9269    -0.002
 Two-year note                 100-2/256    1.246     -0.004
 Three-year note               100-130/256  1.4477    -0.005
 Five-year note                100-16/256   1.8618    -0.006
 Seven-year note               99-208/256   2.154     -0.005
 10-year note                  99-28/256    2.3516    -0.005
 30-year bond                  99-224/256   3.0063    0.001
                                                      
   DOLLAR SWAP SPREADS                                
                               Last (bps)   Net       
                                            Change    
                                            (bps)     
 U.S. 2-year dollar swap        33.25         0.25    
 spread                                               
 U.S. 3-year dollar swap        29.50         0.50    
 spread                                               
 U.S. 5-year dollar swap        11.75         0.50    
 spread                                               
 U.S. 10-year dollar swap       -2.25         0.00    
 spread                                               
 U.S. 30-year dollar swap      -39.25         0.00    
 spread                                               
 
 (Editing by Bernadette Baum)
  

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