November 13, 2018 / 3:10 PM / a month ago

REFILE-TREASURIES-U.S. yields slide to more than one-week low in risk-off stance

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    By Gertrude Chavez-Dreyfuss
    NEW YORK, Nov 13 (Reuters) - U.S. Treasury yields fell to
more than one-week lows on Tuesday,  in tandem with steep losses
on Wall Street the previous session amid worries about global
trade and negotiations about Britain's exit from the European
Union.
    Benchmark U.S. 10-year, 30-year, and two-year yields fell to
their lowest since Nov. 2.
    The Treasury market was closed on Monday for the Veterans
Day holiday.
    Wall Street shares on Tuesday opened on a stronger note
after strong earnings from Home Depot Inc and a rebound
in technology stocks.
    "Today is a spillover from yesterday with the markets
closed. Overall, there are concerns about tech companies, just
trade in general and these are aiding Treasuries," said Justin
Lederer, Treasury analyst, at Cantor Fitzgerald in New York.
    "Global debt is also trading better overall. There are a lot
of unknowns - how does trade play out or how Brexit plays out.
When you put it all together, you have an overall risk-off
trade," he added.
    In morning trading, benchmark 10-year note yields fell to
3.159 percent from 3.189 percent late on Friday. 
Ten-year yields earlier fell to 3.145 percent, a more than
one-week low.
    U.S. 30-year yields were at 3.370 percent,
compared with Friday's 3.392 percent.
    On the short end of the curve, U.S. two-year yields declined
to 2.899 percent, from 2.932 percent on Friday. 
    This week, the market is looking at U.S. consumer prices and
retail sales on the economic data front.
    "In light of the mounting evidence of wage pressures and
elevated input costs, we're cognizant that a spike in core-CPI
will offer solace to the camp anxiously anticipating the return
of demand side inflation," said BOMB Capital Markets in a
research note.
    Federal Reserve Chairman Jerome "Powell might not count
himself among that group given his demonstrated willingness to
hike rates in a low-flation environment, but this fact would
only serve to embolden the pricing-in of more tightening in
2019," it added.
    
      November 13 Tuesday 9:41AM New York / 1441 GMT
                                                      
                                                      
                                                      
                               Price        Current   Net
                                            Yield %   Change
                                                      (bps)
 Three-month bills             2.305        2.3498    -0.005
 Six-month bills               2.455        2.5193    0.002
 Two-year note                 99-242/256   2.9035    -0.028
 Three-year note               99-190/256   2.9654    -0.036
 Five-year note                99-98/256    3.0097    -0.034
 Seven-year note               99-108/256   3.0928    -0.030
 10-year note                  99-164/256   3.1672    -0.022
 30-year bond                  99-228/256   3.3808    -0.011
                                                      
   DOLLAR SWAP SPREADS                                
                               Last (bps)   Net       
                                            Change    
                                            (bps)     
 U.S. 2-year dollar swap        19.25         0.25    
 spread                                               
 U.S. 3-year dollar swap        16.75         0.50    
 spread                                               
 U.S. 5-year dollar swap        13.25         0.25    
 spread                                               
 U.S. 10-year dollar swap        5.75         0.00    
 spread                                               
 U.S. 30-year dollar swap      -10.00        -0.50    
 spread                                               
 
 (Reporting by Gertrude Chavez-Dreyfuss)
  
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