NEW YORK, June 8 (Reuters) – U.S. Treasuries prices rose on Wednesday, pushing a key benchmark yield below 3 percent as the economy’s lagging recovery and a sixth straight day of stock market losses heightened the appeal of safe-haven government debt.

A warning from Fitch Ratings agency that the United States probably would not be able to maintain its prized AAA sovereign ratings if it suffered even a “technical” default on its debt did not keep investors from buying U.S. Treasuries.

The Fitch statement apparently was heard only as a faint cry in the midst of political jousting over spending cuts and boosting the government’s $14.3 trillion debt ceiling before Aug. 2.

Fitch said it would downgrade U.S. sovereign ratings to “restricted default” in August if the government failed to honor Treasury notes and some coupon payments on Treasury securities due on Aug. 15.

“You link the debt ceiling and budget reform too tightly at your own risk; the whole system is based on timely payment of principal and interest,” said Steve Van Order, fixed income strategist with Calvert Investment Management Inc, a Bethesda, Maryland-based firm with $14.5 billion in assets under management.

That said, alternatives to U.S. Treasuries are limited for investors seeking a safe haven.

“Ironically, Treasuries could rally” if global markets are shaken up by a U.S. default, Van Order said. “Look what happened in 2008: we were the source of that whole financial crisis and yet the dollar went up and Treasury yields fell.”

NEW YORK, June 7 (Reuters) – Shorter-dated U.S. Treasuries outperformed longer maturities on Tuesday, ending higher after an auction of three-year notes drew strong demand.

Investors flocked on Tuesday to auctions of four-week Treasury bills and three-year notes.

The well-bid auctions reflected a “supply shortage” at the front end of the Treasury maturity curve, said Rich Bryant, head of U.S. Treasury trading at MF Global in New York.

Remarks late in the session by U.S. Federal Reserve Chairman Ben Bernanke gave bond prices a small added lift, but only a temporary one.

“The whole market seemed to catch a bid after the auction,” said Thomas Simons, money market economist at Jefferies & Co.

That bid allowed Treasuries to erase almost all losses incurred early in the session when stock market gains drew investors away from safe-haven U.S. government debt. Wall Street stocks eventually erased gains and ended the session lower.

Trading in two- and three-year Treasury notes was heavy, said Justin Lederer, Treasury analyst at Cantor Fitzgerald.

NEW YORK, June 2 (Reuters) – The U.S. seasonally adjusted commercial paper market shrank in the latest week as credit demand to fund payrolls and inventories fell, Federal Reserve data showed on Thursday.

The size of the U.S. commercial paper market fell by $1.2 billion to $1.197 trillion on a seasonally adjusted basis in the week ended June 1 from a seasonally adjusted $1.198 trillion outstanding a week earlier.

The size of the market without seasonal adjustments fell to $1.129 trillion from $1.149 trillion.

In other short-term debt, U.S. bill rates hovered above zero, anchored by the Federal Reserve’s near-zero interest-rate policy, designed to nudge investors into somewhat riskier assets and to facilitate lending and economic growth.

U.S. 3-month bills yielded 0.04 percent while six-month bills yielded 0.11 percent.

Despite their minimal yields, the buyside proved eager buyers at Treasury bill auctions earlier this week.

Overseas, benchmark euro-priced interbank lending rates edged up on dwindling excess liquidity and as the prospect of an interim aid deal for Greece supported bets the European Central Bank will hike rates in July.

NEW YORK, June 1 (Reuters) – U.S. sales of $28 billion in 4-week bills and $24 billion in 1-year bills proved popular with investors on Wednesday as a new batch of weak economic data fed appetite for short-term U.S. debt.

For the 4-week bills, the ratio of bids received over those accepted was 4.70. The bid-to-cover ratio for the 1-year bills was nearly the same at 4.69.

In the 4-week bill auction, the Treasury awarded 78.18 percent of the bids at a high rate of 0.040 percent.

In the 1-year bill auction, the Treasury awarded 90.67 percent of the bids at the high rate of 0.180 percent.

The sales occurred as fresh economic data propelled market interest rates lower and spurred talk that the Federal Reserve’s second phase of monetary stimulus known as quantitative easing (dubbed QE2) might not be its last.

In Europe, traders bet that ECB interest rates might rise in the short-term as concerns that Greece would soon need to restructure its debt eased.

Euribor futures continued to inch lower across the 2011-2012 strip <0#FEI:> on Wednesday, sending market-implied rate expectations higher on hopes that officials will agree on a fresh bailout deal for Greece.

NEW YORK (Reuters) – Investors believe lawmakers will raise the U.S. borrowing limit before the debt-ceiling issue affects financial markets and are more focused on the economy’s growth outlook, according to a fixed-income manager at a giant money management firm.

“There’s a core assumption that the $14.3 trillion U.S. debt ceiling will be raised before it becomes a market factor,” said Bill Cunningham, global head of fixed-income research and co-head of global active fixed income at State Street, which has $2 trillion in assets under management, including $381 billion in fixed income assets.

Cunninham said he sees the U.S. economy in a “sustainable recovery, if not a particularly strong one.”

He said if the economy grows moderately in the second half of the year U.S. 10-year Treasury yields could rise to between 3.5 percent to 3.75 percent by year-end, compared with just above 3 percent now.

That rise will more likely be tied to employment picking up, rather than to a risk premium related to long-term U.S. structural deficits, he said.

The U.S. employment picture will be the “real driver of Treasury yields,” Cunningham said. “If we see a steady rise in job creation, we will see a steady rise in Treasury yields.”

The U.S. economy grew an annualized 1.8 percent in the first quarter as the recovery hit a soft patch, and most economists see growth accelerating to 2.5 to 3 percent in the April through June quarter.

NEW YORK (Reuters) – Though yields remained in striking distance of zero, buysiders came out in force at the U.S. Treasury’s three- and six-month auctions on Tuesday, taking advantage of the highest yields since the end of April.

The U.S. Treasury’s Dutch bidding auctions, conducted on Tuesday, rather than the usual Monday, due to the Memorial Day holiday, had no trouble attracting bidders, analysts said.

“Historically, yields at the bottom end of the range tend to drive away buyside bidders,” said Thomas Simons, money market economist at Jefferies & Co. in New York.

“Now that yields have backed up to their highest levels since the end of April, the buyside is coming back and the auctions are drawing more aggressive bids,” he said.

For the $27 billion in three-month bills, the ratio of bids received over those accepted was 4.66 percent, with 69.12 percent of the bids awarded at the high rate of 0.060 percent.

The ratio of bids received over those accepted for the $24 billion in six-month bills was 4.76, with 21.39 percent of the bids awarded at the high rate of 0.115 percent.

The three-month bill auction stopped 0.5 basis point short of the when-issued yield at the 11:30 a.m. (1530 GMT) bidding deadline, Simons said.

NEW YORK (Reuters) – U.S. Treasuries prices firmed on Friday as concerns about the debt situations in Greece and Spain fed investors’ appetite for safe-haven U.S. government debt.

Disagreements on how to tackle Greece’s debt and concern that Spanish regional elections might reveal undisclosed debt in local governments led the bid.

Widening spreads between German and peripheral euro-zone bond yields offered further evidence of those concerns.

Many economists say worse-than-expected regional budget figures from Spain could start to trickle out after Sunday’s vote.

“This is pushing the euro lower, periphery debt wider, and stocks lower. Thus, European bunds and U.S. Treasuries are rallying,” said John Briggs, Treasury strategist at RBS Securities.

Benchmark 10-year notes were up 2/32, their yields at 3.175 percent, little changed from Thursday and unchanged from a week ago.

The Treasury will sell $99 billion in coupons in 2-year, 5-year, and 7-year notes and traders said that could give prices a little downward bias early next week.

NEW YORK, May 19 (Reuters) – U.S. Treasuries prices fell on Thursday as the government’s latest report on new jobless claims painted a more upbeat picture of the labor market.

The economy’s ability to produce jobs will be a major ingredient in formulating the future course of monetary policy, with the Federal Reserve better able to gradually reduce monetary accommodation if the labor market’s health improves.

Investors expect the scheduled end next month of the Fed’s latest stimulus program will hurt stocks and bonds, a Reuters poll said. For more information, please see [ID:nSLAJGE7U1] and [nLDE74I0R4]

Bonds sold off after the jobless data because “the message is there is not a severe deterioration in the labor market,” said Pierre Ellis, senior economist at Decision Economics in New York.

He also noted that continuing claims, reflecting the actual number of employment benefit checks issued, fell back after having risen sharply,

“Next week’s continuing claims number, which will refer to the payroll survey week, will be decisive,” Ellis said. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

New claims for unemployment benefits fell more than expected last week to 409,000 r.reuters.com/wuh69r ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

NEW YORK, May 18 (Reuters) – U.S. Treasuries prices slipped on Wednesday as investors took profits from a rally that had pushed yields to their lowest levels since December.

Traders said investors resisted buying securities that were at their highest prices and lowest yields in months.

Modest buying of stocks and commodities drove a rise in global stocks after five straight days of losses, and oil and commodity prices also rose after recent losses.

U.S. crude CLc1 approached $100, up more than 2 percent and cutting the month’s losses to just below 13 percent.

Benchmark 10-year Treasury notes US10YT=RR slipped in price by 8/32. Ten-year yields rose to 3.15 percent, up from 3.10 percent early in the session, the lowest since early December.

Still, with just modest declines in U.S. government debt prices, investors were hardly abandoning the safe-haven asset.

Economists said recent U.S. economic data suggests a sluggish start to the second quarter, which, even if temporary, will hurt growth for the quarter overall.

NEW YORK, May 18 (Reuters) – U.S. Treasuries prices slipped on Wednesday as investors took profits from a rally that pushed yields to their lowest since December.

Investors were evaluating how much further the move in bonds would last. Given that downward momentum in yields has been slow in recent days, buyers were not yet convinced they had to rush into the market.

That could let yields move lower, some traders said, though the market still needed data to confirm that a U.S. economic slowdown has taken hold.

“With the Fed needing to address the jobs picture and housing looking ready for another dip as summer approaches, 10-year yields below 3 percent look likely given all the economic uncertainty,” said Thomas di Galoma, managing director of government securities at Oppenheimer & Co in New York.

Benchmark 10-year Treasury notes US10YT=RR, up 4/32 initially, erased that modest gain and slipped 11/32 amid some profit-taking, traders said.

Ten-year yields rose to 3.14 percent but stood at 3.10 percent early in the session, the lowest since early December.

Traders said the release of the minutes from the Federal Reserve’s policy-setting committee in mid-afternoon will be the main event of the session.