U.S. Government bonds rise modestly ahead of first presidential debate

The US Treasuries were pushed modestly higher across the curve Monday as markets await Hillary Clinton and Donald Trump’s first debate of the 2016 presidential election.

The yield on the benchmark 10-year Treasury note fell 1-1/2 basis points to 1.601 percent, the yield on 5-year bond dipped 1 basis point to 1.143 percent and the yield on short-term 2-year note slid ½ basis point to 0.750 percent by 12:30 GMT.

According to Reuters, polls indicate a tightening race between Democrat Hillary Clinton and Republican Donald Trump in a vote shaping up as a major risk event for financial markets. Monday's presidential debate could push U.S. bond yields higher if the candidates hinted at more expenditure or tax cuts, which would increase the federal deficit and borrowing.

According to a Bloomberg poll, Trump and Clinton are evens in a head to head race at 46 percent each. In a 4-way national race, Trump leads by 43 percent to 41 percent for Hillary, Generic House election Democrats 46 percent, 44 percent Republican.

That last result will be put to the test as we get the first of three head to head debates between the two Presidential candidates. The first face-off between Republican Donald Trump and Democrat Hillary Clinton will take place at 01:00 GMT on Tuesday.

Moreover, markets now look ahead to a greater flow of data in this week, highlighted by durable goods orders, GDP, personal income/spending, consumer confidence and University of Michigan consumer sentiment releases.

Meanwhile, the S&P 500 Futures traded 10 points lower at 2,148.25 by 12:30 GMT.