August 1, 2019 / 4:21 PM / 22 days ago

REFILE-TREASURIES-U.S. bond yields hit 4-week lows on weak growth view

 (Refiles to fix story title)
    By Richard Leong
    NEW YORK, Aug 1 (Reuters) - U.S. Treasury yields fell on
Thursday, with longer-dated yields hitting four-week lows as
investors piled into U.S. government debt on the view global
economic growth would decelerate further and domestic inflation
would stay sluggish.
    Shorter-dated yields dropped as traders reconsidered whether
the Federal Reserve could limit the number of rate cuts in the
coming months if global business activities deteriorate further
due to trade tensions.
    On Wednesday, the Fed implemented its first rate decrease
since 2008, though Chairman Jerome Powell dampened expectations
that the central bank had adopted an easing policy that involves
a series of rate cuts.
    "The bottom line is that they are looking for insurance
cuts," said Gennadiy Goldberg, senior interest rates strategist
at TD Securities in New York. 
    The futures market implied traders see a 61% chance the Fed
would lower rates again at its Sept. 17-18 policy meeting, up
from 51% late on Wednesday, according to CME Group's FedWatch
program.
    Thursday's disappointing economic data also stoked the
safe-haven appetite for Treasuries.
    The Institute for Supply Management said its index of
national factory activity fell to 51.2 last month, the lowest
reading since August 2016, while U.S. construction spending fell
in June.
    At 12:10 p.m. (1610 GMT), yields on benchmark 10-year
Treasury notes were 5.50 basis points lower at
1.966%. They touched 1.952% earlier Thursday, which was the 
lowest since July 5.
    The 30-year bond gained 1 point in price for a
yield of 2.481%, down 4.50 basis points on the day. Thirty-year
yields hit 2.465%, the lowest since July 5. 
    
August 1 Thursday 12:09PM EDT/ 1609 GMT
                               Price                   
 US T BONDS SEP9               156-25/32    1-6/32     
 10YR TNotes SEP9              127-252/256  0-144/256  
                               Price        Current    Net
                                            Yield %    Change
                                                       (bps)
 Three-month bills             2.045        2.0898     0.005
 Six-month bills               2.0425       2.0924     -0.004
 Two-year note                 99-220/256   1.8221     -0.066
 Three-year note               99-238/256   1.7744     -0.074
 Five-year note                99-234/256   1.768      -0.077
 Seven-year note               100-26/256   1.8594     -0.069
 10-year note                  103-168/256  1.9623     -0.059
 30-year bond                  108-92/256   2.4765     -0.049
                                                       
   DOLLAR SWAP SPREADS                                 
                               Last (bps)   Net        
                                            Change     
                                            (bps)      
 U.S. 2-year dollar swap         4.25         0.25     
 spread                                                
 U.S. 3-year dollar swap         0.50         0.25     
 spread                                                
 U.S. 5-year dollar swap        -2.25         0.75     
 spread                                                
 U.S. 10-year dollar swap       -7.50         0.00     
 spread                                                
 U.S. 30-year dollar swap      -36.25        -0.50     
 spread                                                
 

 (Reporting by Richard Leong; Editing by Bernadette Baum and Dan
Grebler)
  
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