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(Corrects headline to say yields moved higher) By Herbert Lash NEW YORK, Sept 21 - Longer-dated U.S. Treasury yields edged higher on Tuesday after an auction of 20-year bonds was well received and investors waited for the end of this week's Federal Reserve meeting that may shed light on when its massive purchase of government debt will begin to ease. The yield on the benchmark 10-year Treasury note rose 1.4 basis points to 1.323%, while yields on 20-year Treasuries narrowed, up 0.7 basis points. The sale of $24 billion in 20-year notes was "stellar," a characterization of several recent longer-dated auctions, said Kim Rupert, managing director of global fixed-income analysis at Action Economics LLC. Every metric of the auction was at or near record levels, with the exception of a disappointing bid cover, Rupert said. The bonds were sold at a high yield of 1.795% with a bid-to-cover ratio, a gauge of demand, of 2.36. Stocks on Wall Street rose as investors put aside concerns about a potential collapse of property developer China Evergrande Group and the impact its $305 billion in obligations could inflict on the Chinese economy and financial markets. Analysts played down the threat of Evergrande's troubles even as Beijing showed no signs of intervening to stem any domino effects. The start of the Fed's two-day policy-setting meeting was of greater concern as analysts await any signal regarding when the U.S. central bank will begin tapering its asset purchases. "The pace of reductions dictates to some degree the timing of the first Fed rate hike," said Guy LeBas, chief fixed-income strategist at Janney Capital Management. "Markets have essentially priced in a $10 billion-a-month pace of reduction." A $5 billion-a-month reduction in bond purchase would further delay expectations of the Fed's first rate hike, while a $15 billion-a-month reduction would pull forward expectations of a first rate hike, LeBas said. A steady reduction, spread out over several quarters, would likely minimize any disruption to the financial markets. The Fed is likely to indicate the initiation of tapering in November at a rate that will be firmly set so as to eliminate purchases by mid-2022, said John Vail, chief global strategist at Nikko Asset Management, in a note. 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 110.5 basis points. The two-year U.S. Treasury yield, which typically moves in step with interest rate expectations, was unchanged at 0.216%. The breakeven rate on five-year U.S. Treasury Inflation-Protected Securities (TIPS) was last at 2.467%. The 10-year TIPS breakeven rate was last at 2.3%, indicating the market sees inflation averaging about 2.31% a year for the next decade. September 21 Tuesday 2:10PM New York / 1810 GMT Price Current Net Yield % Change (bps) Three-month bills 0.025 0.0253 -0.005 Six-month bills 0.045 0.0456 0.000 Two-year note 99-211/256 0.2159 0.000 Three-year note 99-196/256 0.4543 0.002 Five-year note 99-156/256 0.8309 0.010 Seven-year note 100-4/256 1.1226 0.012 10-year note 99-84/256 1.3226 0.014 20-year bond 99-48/256 1.7987 0.006 30-year bond 103-64/256 1.8578 0.011 DOLLAR SWAP SPREADS Last (bps) Net Change (bps) U.S. 2-year dollar swap 11.25 0.25 spread U.S. 3-year dollar swap 12.25 0.25 spread U.S. 5-year dollar swap 10.25 0.00 spread U.S. 10-year dollar swap 2.50 -0.75 spread U.S. 30-year dollar swap -24.75 -0.75 spread (Reporting by Herbert Lash; Additional reporting by Stefano Rebaudo in London; Editing by Lisa Shumaker and Barbara Lewis)