Australian bonds trade slightly lower in quiet session; U.S. Treasuries witness modest selling

Australian government bonds traded slightly lower on Wednesday as investors remain sidelined in any major deal in light trading after the Christmas holiday.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, rose 1/2 basis point to 2.722 percent, the yield on the long-term 30-year note traded nearly flat at 3.439 percent and the yield on short-term 2-year climbed 1-1/2 basis points to 2.029 percent by 03:20 GMT.

In the United States, Treasuries saw range bound trading with modest selling in the short-end contrasted by gains further out the curve to open the week during a relatively quiet Tuesday session light on data of great significance.

With respect to data, markets largely absorbed a handful of lower-tier releases, highlighted by S&P CoreLogic Case-Shiller home prices (composite-20 measure increasing 6.4 percent y/y in October, from +6.2 percent y/y in September), followed by mixed readings from Richmond Fed and Dallas Fed manufacturing releases.

Markets now look ahead to what stands to be another relatively light Wednesday session, highlighted by Conference Board consumer confidence and pending home sales data, followed by a 5-year Note auction later in the session.

Meanwhile, the S&P/ASX 200 index traded 0.13 percent higher at 6,033.5 by 03:20 GMT, while at 03:00GMT, the FxWirePro's Hourly AUD Strength Index remained neutral at -44.87 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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