U.S. Treasuries nearly flat ahead of 5-year, 7-year auctions

The U.S. Treasuries traded nearly flat Wednesday amid a silent trading session that witnessed data of little economic significance. Investors are awaiting the country’s 5-year auction, scheduled to be held later today and the 7-year auction, due on January 25.

The yield on the benchmark 10-year Treasuries rose 1 basis point to 2.63 percent, the super-long 30-year bond yields also edged 1 basis point higher to 2.91 percent and the yield on the short-term 2-year traded flat at 2.06 percent by 11:00GMT.

In the US, December’s existing home sales figures are due along with the FHFA house price indices for November. In addition, the preliminary Markit US PMIs for January – much less watched than their euro area equivalents – are also due.

Optimism on global growth prospects and positive corporate earnings were more than offset by news concerning protectionism measures announced by the US administration. Elsewhere, the USD continued to lose ground on the view that other major CBs will follow the Fed in gradually withdrawing monetary accommodation.

Turning to core government bonds, both Bund and US Treasury yields were higher on the day, albeit still below recent highs as investors await upcoming key events for direction including Thursday’s ECB monetary policy meeting, the next FOMC meeting and the US Treasury’s next quarterly funding plans both due on January 31. 

Meanwhile, the S&P 500 Futures traded 0.17 percent higher at 2,844.50 by 11:05GMT, while at 11:00GMT, the FxWirePro's Hourly Dollar Strength Index remained highly bearish at -147.95 (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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