TOKYO: US Treasuries slipped in Asian trade on Tuesday as equities firmed, ahead of this week's sales of $99 billion in new coupon-bearing debt
The Treasury will sell $35 billion in two-year notes on Tuesday. It will offer $35 billion in five-year notes on Wednesday and then $29 billion seven-year notes on Thursday.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.1 percent, holding above Friday's five-week low of 464.99.
The yield on the 10-year notes rose to 2.05 percent on Tuesday, after straddling the 2 percent level in Friday's US trade. The bond market closed early on Friday, and was closed on Monday to observe the Memorial Day holiday.
Ten-year yields have surged from 1.61 percent in early May, gaining traction after Wednesday last week when Federal Reserve Chairman Ben Bernanke told a congressional panel that a decision on whether to scale back the Fed's current monthly pace of $85 billion in asset purchases could come at one of the central bank's "next few meetings" depending on economic data.
"The market's range expectation has changed. While before people estimated the benchmark yield would stick to a 1.5 percent to 2 percent range this year, that has shifted to 1.7 percent to 2.3 percent, as the market focuses on what the Fed decides to do about its easing," said Arihiro Nagata, manager of foreign bond trading at Sumitomo Mitsui Banking Group.
The yield on 30-year notes rose to 3.21 percent from 3.17 percent in Friday's US trade.
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