June 19, 2020 / 1:39 PM / 25 days ago

TREASURIES-Yields rise as report China to accelerate U.S. farm purchases boosts risk appetite

    By Karen Brettell
    NEW YORK, June 19 (Reuters) - U.S. Treasury yields rose on
Friday as risk appetite increased  and demand for safe haven
bonds eased, after a report that China will speed up purchases
of U.S. farm goods.
    Bloomberg News reported that China will accelerate purchases
to comply with the Phase One trade deal with the United States. 

    “News of the nice tone to the U.S.-China trade relations,
and whatever else contributed to the ‘risk on’ tone is affecting
Treasuries negatively, so you’re seeing the curve steepen from a
selloff led by the back end of the curve,” said Michael Lorizio,
senior fixed income trader at Manulife Asset Management in
Boston.
    Benchmark 10-year note yields rose four basis
points to 0.730%. Thirty-year yields were up five
basis points to 1.514%.
    The yield curve between two-year and 10-year notes
 steepened two basis points to 53 basis points.
    Investors are weighing improving economic data against new
breakouts of COVID-19 infections, which have added to concerns
that the economy may not bounce back from business shutdowns as
quickly as hoped.
    California, North Carolina and a string of U.S. cities
mandated or urged mandatory mask use on Thursday to get a grip
on spiraling coronavirus cases as at least six states set daily
records.
    Mainland China reported 32 new coronavirus cases as of the
end of June 18, twenty-five of which were reported in the
capital city Beijing, China's National Health Commission said on
Friday.
    Federal Reserve Chair Jerome Powell will speak on Friday in
a virtual discussion about workforce resilience during the
COVID-19 era.
    The U.S. central bank earlier this month signaled it plans
years of extraordinary support for the economy, with
policymakers projecting the economy to shrink 6.5% in 2020 and
the unemployment rate to be 9.3% at year's end.
    
    June 19 Friday 9:13 AM New York / 1313 GMT
                               Price                  
 US T BONDS SEP0               176-12/32    -1-1/32   
 10YR TNotes SEP0              138-140/256  -0-72/25  
                                            6         
                               Price        Current   Net
                                            Yield %   Change
                                                      (bps)
 Three-month bills             0.155        0.1572    0.000
 Six-month bills               0.1725       0.175     0.000
 Two-year note                 99-222/256   0.1936    -0.001
 Three-year note               100-16/256   0.2289    0.008
 Five-year note                99-136/256   0.3458    0.020
 Seven-year note               99-160/256   0.5552    0.032
 10-year note                  99           0.7299    0.036
 20-year bond                  97-96/256    1.2748    0.050
 30-year bond                  93-172/256   1.5139    0.053
                                                      
   DOLLAR SWAP SPREADS                                
                               Last (bps)   Net       
                                            Change    
                                            (bps)     
 U.S. 2-year dollar swap         6.50         0.50    
 spread                                               
 U.S. 3-year dollar swap         4.25         0.00    
 spread                                               
 U.S. 5-year dollar swap         3.25         0.00    
 spread                                               
 U.S. 10-year dollar swap       -2.50         0.25    
 spread                                               
 U.S. 30-year dollar swap      -50.25         0.25    
 spread                                               
                                                      
 

    
    

  
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