(Updates with market activity, analyst comment, auction
results)
By Ross Kerber
June 24 (Reuters) - U.S. Treasury yields fell on Wednesday
as investors bought safe-haven assets with an eye on rising
COVID-19 patient cases in several U.S states.
The benchmark 10-year yield was down 2.5 basis
points at 0.6839% in afternoon trading as investors moved into
safer government bonds and away from equities.
Wall Street indexes fell as shares of airlines, resorts and
cruise operators slumped on public health concerns.
The governors of New York, New Jersey and Connecticut announced
that visitors from states with high coronavirus infection rates
must self-quarantine for 14 days on arrival.
The trading reflected investors deciding the U.S. economy
would not bounce back quickly from the pandemic, said Thomas
Simons, Jefferies LLC money market economist.
"It's this kind of slow realization that we're not going to
see a straight-line improvement coming out of the lockdown phase
of the virus," he said.
Although the United States had appeared to get ahead of the
COVID-19 pandemic in May, new cases rose 25% last week.
Washington state made masks mandatory in public places, while
other states saw record cases, including Arizona and Texas,
where restrictions meant to slow its spread were lifted
early.
A closely watched part of the U.S. Treasury yield curve
measuring the gap between yields on two- and 10-year Treasury
notes was at 49 basis points, within the narrow
range it has held for a week but double its mid-March level.
The two-year U.S. Treasury yield, which typically
moves in step with interest rate expectations, was down less
than a basis point at 0.1876% in afternoon trading.
A Treasury Department auction of $47 billion of five-year
notes showed strong demand with non-dealers accounting for 78%
of accepted bids, versus an average of 72.9%, according to a
note from BMO Capital Markets.
June 24 Wednesday 2:08PM New York / 1808 GMT
Price Current Net
Yield % Change
(bps)
Three-month bills 0.15 0.1521 0.000
Six-month bills 0.17 0.1725 -0.002
Two-year note 99-224/256 0.1876 -0.008
Three-year note 100-30/256 0.2104 -0.006
Five-year note 99-172/256 0.3171 -0.008
Seven-year note 99-224/256 0.5184 -0.014
10-year note 99-112/256 0.6839 -0.025
20-year bond 98-136/256 1.2083 -0.040
30-year bond 95-64/256 1.4463 -0.043
DOLLAR SWAP SPREADS
Last (bps) Net
Change
(bps)
U.S. 2-year dollar swap 6.25 0.25
spread
U.S. 3-year dollar swap 4.75 0.25
spread
U.S. 5-year dollar swap 4.25 0.50
spread
U.S. 10-year dollar swap -1.50 0.25
spread
U.S. 30-year dollar swap -48.75 0.50
spread
(Reporting by Ross Kerber in Boston; editing by Jonathan Oatis
and Richard Chang)
Source: Read Full Article