NEW YORK, Feb 5 (Reuters) – The cost of insuring U.S. Treasuries against default ended little changed on Friday, down from a 10-month high, as worries over a possible U.S. government default lingered.

The price on five-year credit default swaps on Treasuries retreated from its initial highs after the cost to insure the sovereign debt of certain European countries fell back from record highs hit earlier, CMA DataVision said.

This week’s rise in Treasury CDS prices implied traders have priced in about a 5 percent chance of a U.S. government default in the next five years, according to the credit data firm.

Worries over possible defaults by Greece, Portugal and Spain have ratcheted up the cost to insure the government debt worldwide, including Germany and the United States, this week.

NEW YORK, Feb 5 (Reuters) – U.S. Treasuries rose on Friday, building on Thursday’s rally, after a surprise fall in payrolls in January reinforced the view that the Federal Reserve will stick to its easy monetary policy.

Persistent fears over a possible default by Greece and other debt-laden European nations added to a safety bid for Treasuries and low-risk assets, analysts said.

Bonds’ gains were curbed by some profit-taking on Thursday’s rally and as traders made room for $81 billion in supply next week.

Anxiety over market turmoil due to sovereign fiscal woes intensified in advance of a meeting of Group Seven finance ministers and central bankers in Canada. They are expected this weekend to discuss various topics, including foreign exchange and financial reforms, as the global economy makes a tentative recovery. See [ID:nN02242236]

NEW YORK, Feb 5 (Reuters) – Short-dated U.S. Treasuries rose on Friday after data showing an unexpected job loss in January spurred the view that the Federal Reserve will stick to its easy monetary policy amid an uneven U.S. recovery.

Persistent fears over default by Greece and other debt-ladened European countries added to a safety bid for cash, Treasuries and other low-risk investments, analysts said.

Longer-dated government debt lagged its short-dated counterparts on profit-taking from Thursday’s rally and as traders make ready for $81 billion in supply next week.

“The Fed is not in a position to raise rates any time soon,” said Larry Milstein, head of government and agency trading at R.W. Pressprich & Co. in New York. “It was an overall weak jobs report.”

NEW YORK, Feb 5 (Reuters) – U.S. government debt prices were flat to lower on Friday in choppy trading, after data showed a mixed picture on labor conditions, suggesting a U.S. recovery would remain uneven.

The conflicting signals in the goverment’s employment readings in January erased bonds’ initial gains that were spurred by fears over default by Greece and other debt-ladened European countries.

The U.S. Labor Department said employers shed 20,000 jobs last month, but the jobless rate fell to 9.7 percent. Analysts polled by Reuters had forecast a net job gain of 5,000 and an unemployment rate of 10.1 percent. [ID:nN04115255]

“You get a mixed bag here,” said Kevin Flanagan, chief fixed income strategist with Morgan Stanley Smith Barney in Purchase, New York. “The Treasury market isn’t really rallying on this. I am not sure it is adding any new economic information.”

NEW YORK, Feb 4 (Reuters) – U.S. short-term interest rates markets rallied on Thursday as growing anxiety over fiscal problems in Europe unleashed a stampede into low-risk dollar assets, analysts said.

This flight-to-safety, plus an unexpected rise in U.S. jobless data, led to a surge in rates futures with deferred contracts hitting fresh highs. The move implied traders were betting the U.S. Federal Reserve may stick to its near-zero rate policy longer than previously thought, analysts said.

Across the Atlantic, benchmark rates futures in the region also rose after the Bank of England and European Central Bank left their policy rates at record lows.

“It’s a deleveraging trade that’s taking place. Rates are going to be low for a longer time,” said John Brady, senior vice president with MF Global in Chicago.

NEW YORK (Reuters) – The cost for investors to insure against a U.S. government default rose to its highest level in nearly 10 months on Thursday, amid jitters over rising sovereign risks.

A surge in government borrowing due to the global recession and credit crisis has elevated anxiety over various nations’ indebtedness, regardless of their size.

The U.S.’s soaring deficit has resurrected doubts over its long-term ability to repay its debt. Investors have grown worried whether Treasuries’ coveted AAA-rating and its global benchmark status are in danger.

On Wednesday, Moody’s Investors Service warned that weak growth will compound downward pressure on the U.S.’s top credit rating.

NEW YORK, Jan 29 (Reuters) – U.S. Treasuries rose on Friday, erasing earlier losses, prompted by growing doubts over data showing a whopping 5.7 percent percent pace of economic growth in the fourth quarter.

The emergence of long-dated buying to meet month-end portfolio needs also helped to fuel the rebound in bonds, analysts and traders said.

“People don’t really trust the GDP data. No one thinks the economy is going gang-busters,” said Brian Edmonds, head of rates with Cantor Fitzgerald in New York.

Persistent concerns over Greece’s fiscal crisis and its toll on Europe, coupled with choppy trading in the stock market also helped spur the market into positive territory.

NEW YORK, Jan 29 (Reuters) – U.S. Treasuries traded mostly flat on Friday, paring earlier losses as Wall Street turned lower and revived a bid for bonds, offsetting the effect of unexpectedly strong economic data.

Growing doubts over whether the blistering 5.7 percent pace of economic growth in the fourth quarter is sustainable also helped lift the market from its initial lows, analysts said.

“People don’t really trust the GDP data. No one thinks the economy is going gang-busters,” said Brian Edmonds, head of rates with Cantor Fitzgerald in New York.

Ongoing uncertainty over Greece’s fiscal crisis and its toll on Europe, along with intensifying month-end buying of Treasuries, also helped the market to erase initial losses.

NEW YORK, Jan 29 (Reuters) – U.S. Treasuries fell on Friday, as a batch of unexpectedly strong data led by robust U.S. economic growth fueled hopes of a durable economic recovery, paring a safe-haven bid for bonds.

Higher stock prices and dealers flipping some new Treasuries bought this week exerted more downward pressure on bonds, traders said.

“We are getting some real improvement in the economy, but we need to see more,” said Larry Milstein, head of government and agency trading at R.W. Pressprich & Co in New York.

Bonds weakness was mitigated by ongoing uncertainty over Greece’s fiscal crisis and its toll on Europe. Typical month-end buying of Treasuries also curbed market losses.

NEW YORK, Jan 29 (Reuters) – U.S. Treasuries fell on Friday, as a surprisingly robust reading on economic growth and stronger stock index futures reduced safe-haven demand for government bonds.

Government data showed the U.S. economy expanded at an annualized pace of 5.7 percent, its fastest in six years. This unexpectedly strong reading on the U.S. Gross Domestic Product fanned worries the Federal Reserve may raise rates sooner than previously thought. For more, see [ID:nN28120005]

But some analysts questioned whether this robust pace is sustainable since much of the increase resulted from a sharp cutback in inventory liquidation, rather than a large pickup in either consumer spending and business investment. In the absence of further government stimulus, the expansion could lose steam in the coming months, they said.

“It’s possible this could lead to higher interest rates, but most investors are looking past government programs and to the second half of the year when we won’t have the Fed buying (securities) and (government) stimulus,” said Jack Ablin, chief investment officer with Harris Private Bank in Chicago.