January 14, 2011 by staff, Treasury gains compared after the sale of $ 13 billion in U.S. securities than 30 years drew a yield higher than expected. The 30-year bonds at an auction yielded 4.515 percent, compared to an average estimate of 4.511 percent in a Bloomberg News survey of 6 of the Federal Reserve of the 18 primary dealers. U.S. government securities earlier gained after the Fed bought $ 8.4 billion and treasury bills maturing in July 2016 to December 2017 as part of its plan to 600 billion purchase obligations, according to its website.

“We had a fairly dramatic movement leading to the auction,” said Richard Bryant, senior vice president in fixed income at MF Global Inc. in New York, a broker of futures contracts traded. “The race was pretty hairy. It was difficult for dealers to implement. We got a tail out of the rich levels of the day. ”

The yield on the 30-year bonds fell a basis point, or 0.01 percentage point to 4.53 percent at 1:39 p.m. in New York, according to BGCantor Market Data. It fell to seven basis points before the sale. Ten-year note yields fell four basis points to 3.33 percent, after having previously lost seven basis points.

“The Treasury program to purchase more aggressive than was thought and added” umph to the market, “Kevin Flanagan, a Purchase, New York, fixed income strategist for Morgan Stanley Smith Barney, said before the sale auction. “The market is in a situation where, when yields rise, investors come and enjoy.”

The difference between yields on U.S. 2 – and 30 years earlier securities widened to a record high, investors demanded higher wages against inflation risks that the economy gains traction.

On sale today for long-term bonds, the supply coverage ratio, which measures demand by comparing total bids with the amount of securities offered, was 2.67. The average over the last 10 auctions was 2.70. thirty-year bonds yielded 4.41 percent at the latest offering, Dec. 9.

Indirect bidders, a class of investors that includes foreign central banks, bought 37.8 percent bonds, compared to 49.5 percent in December, the most since July 2009. The average for the last 10 sales was 36.9 percent.

direct bidders, investors non-primary-dealer distributing their offerings directly from the Treasury, bought 12.4 percent of the debt, compared to 8.1 percent in December and offers an average of 10 sales 16.8 per cent.

The sale was a reopening of the auction on November 10 to 30-year bonds, which attracted yield of 4.32 percent.

government reports showed the U.S. index of producer prices rose last month by more than 11 months, while the trade deficit shrank unexpectedly in November. Another report showed initial claims for unemployment benefits rose more than expected last week.

The United States and sold 21 billion 10-year notes yesterday at a yield of 3.3 percent, the highest level since April. A $ 32 billion auction of three-year debt on Jan. 11 sold for 1.027 percent, the highest yield since July. The United States and 13 billion sale of 30 years ago tomorrow, debt, completed this week and 66 billion sale of notes and bonds.

U.S. 30-year bonds returned 8.7 percent this year compared to 5.9 percent for the entire Treasury market, according to Bank of America Merrill Lynch.

The Fed will buy tomorrow and 6 to 8 billion and securities of the United States due in January 2015 to June 2016, according to its website.


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