* Temporary reprieve from supply bolsters bonds

* Weak economic data helps market's recovery

* Month-end interest reinforces market's rebound
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By Pedro Nicolaci da Costa

NEW YORK, May 29 (Reuters) - U.S. Treasuries rose sharply
on Friday as investors cheered a temporary reprieve from a
heavy debt issuance schedule and economic data proved weak,
also supporting bonds.

Weak economic reports reminded investors that any incipient
recovery from the worst recession in decades is at best
rickety, restoring some of the allure of safe-haven government
bonds.

Month-end interest from portfolio managers also bolstered
the market, ensuring solid gains in longer maturities.

"All the factors that were leading us down have withdrawn
and we're starting to see some real buying," said Rick
Klingman, managing director of Treasury trading at BNP Paribas
in New York.

Bonds had been stuck in selling mode for two months, and
the downturn reached fever pitch earlier this week as investors
tried to absorb $101 billion of government note auctions this
week alone, an amount that matched a weekly record set in
April.

But the downturn seemed to have gone far enough to attract
some buyers, allowing benchmark 10-year notes US10YT=RR to
jump 1-5/32 for a yield of 3.47 percent, versus 3.61 percent at
Thursday's close. That was still up more than a full percentage
points from lows seen back in March when the Federal Reserve
first announced its emergency Treasury purchase program.

Traders cited the unwinding of short positions related to
the mortgage market as further bolstering buying.

The session's economic data helped Treasuries. Revisions to
first-quarter gross domestic product showed the economy
contracting at an annual rate of 5.7 percent in the first
quarter, a slightly smaller drop than initially estimated but
worse than analysts' expectations. For details, see
[ID:nN29399341]

Lending further support to bonds, a separate report showed
business activity in the U.S. Midwest contracted in May at a
much more severe rate than expected.

Dealers saw any gains as a victory after recent worries
over the cost of financing the national debt hammered
longer-dated bond prices, which steepened the difference in
their yields versus shorter maturities to the highest on
record.

Other data showing consumer sentiment improved slightly
more than expected in May had little immediate effect on the
market.

The 30-year long bond US30YT=RR was up 2-14/32, yielding
4.34 percent versus Thursday's close of 4.49 percent.

Two-year notes US2YT=RR were up 3/32, yielding 0.93
percent versus 0.98 percent late on Thursday.

Still, the rally in longer-dated Treasuries reduced some of
the steepness of the yield curve after the difference between
two- and 10-year notes jumped to its widest on record during
Wednesday's bond market rout.

A steep yield curve is considered a harbinger of economic
recovery and particularly helpful to banks' profitability.
(Additional reporting by Burton Frierson; Editing by Kenneth
Barry)