TREASURIES-Most yields lower as jobless claims soar and Fed boosts efforts

(Updates with market activity, stock market trends) By Karen Pierog and Ross Kerber CHICAGO/BOSTON, April 9 - Most U.S. Treasury yields fell on Thursday as the Federal Reserve rolled out aggressive steps to prop up the economy during the COVID-19 pandemic, and weekly jobless claims remained huge. The yield on the benchmark 10-year note was down 4.8 basis points at 0.7159% in afternoon trading. That was close to where it stood at the start of business Thursday as the Fed announced an aggressive new $2.3 trillion effort to prop up the economy including new loans to small businesses and direct lending to state and local governments. Separately, U.S. data showed the number of Americans filing for jobless claims fell slightly last week to 6.6 million from an upwardly revised 6.87 million the prior week. Analysts said the policy action and data underscored the vast sweep of the health emergency that has shuttered businesses nationwide, even as Wall Street rose for the third time in four days. Together, all the economic news is likely making the safety and liquidity of Treasuries more attractive, said Gary Pollack, managing director of fixed income at Deutsche Bank Private Wealth Management in New York. "Because of a flight-to-safety trade, I think that's what Treasuries are benefiting from as we get more evidence of the economic impact from the COVID-19 crisis," he said. The two-year U.S. Treasury yield, which typically moves in step with interest rate expectations, was down 3.5 basis points at 0.2215%. The 3-month U.S. Treasury bill yielded 0.234%, up 3.6 basis points. It reached 0.433% overnight, the highest since March 13, reflecting large new short-term Treasury issuance. A closely watched part of the U.S. Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes, seen as an indicator of economic expectations, was at 49.5 basis points, about two basis points lower than Wednesday's close. Bids submitted in a Thursday morning four-day repurchase agreement (repo) operation totaled $2.5 billion, according to the New York Federal Reserve, which said it accepted all the bids. No bids were submitted for an 85-day repo operation. April 9 Thursday 12:37PM New York / 1637 GMT Price US T BONDS JUN0 179 0-23/32 10YR TNotes JUN0 138-80/256 0-120/25 6 Price Current Net Yield % Change (bps) Three-month bills 0.23 0.234 0.036 Six-month bills 0.2425 0.2468 0.014 Two-year note 100-77/256 0.2215 -0.035 Three-year note 99-226/256 0.2893 -0.053 Five-year note 100-120/256 0.4045 -0.063 Seven-year note 100-50/256 0.5963 -0.057 10-year note 107-112/256 0.7159 -0.048 30-year bond 116-44/256 1.3406 -0.023 DOLLAR SWAP SPREADS Last (bps) Net Change (bps) U.S. 2-year dollar swap 23.75 -1.25 spread U.S. 3-year dollar swap 16.75 1.00 spread U.S. 5-year dollar swap 14.50 1.25 spread U.S. 10-year dollar swap 7.50 2.25 spread U.S. 30-year dollar swap -34.50 3.00 spread (By Karen Pierog in Chicago and by Ross Kerber in Boston; Editing by Jonathan Oatis and Richard Chang)