U.S. Treasuries nearly steady in silent trading session; Q3 GDP in focus

The U.S. Treasuries flattened Tuesday, in a muted trading session that witnessed data of economic significance ahead of the long year-end holidays. Top Republicans said on Sunday they expected Congress to pass a tax code overhaul this week, with a Senate vote as early as Tuesday and President Donald Trump aiming to sign the bill by week’s end.

Also, investors are eyeing the country’s gross domestic product (GDP) for the third-quarter of this year, scheduled to be released on December 21 to provide further direction in the debt market.

The yield on the benchmark 10-year Treasuries remained flat at 2.39 percent, the super-long 30-year bond yields fell 1/2 basis point to 2.74 percent and the yield on the short-term 2-year hovered around 1.83 percent by 10:30GMT.

In the US, the House of Representatives looks set to vote on the final tax reform bill. With Republicans firmly in the majority, there is little doubt that the bill will be passed with ease in the House, with tomorrow’s likely Senate vote also now seemingly on track after pivotal Maine Republican Senator Susan Collins suggested she’d now not stand in the way of the bill. Data-wise, the US focus will be on November housing starts data and Q3 current account figures.

US housing starts and building permits for November are likely to attract limited attention. The most significant US data release this week will be Friday’s personal spending and income figures for November, and the accompanying PCE deflator which is the Fed’s preferred inflation measure.

Meanwhile, the S&P 500 Futures traded 0.08 percent higher at 2,696.88 by 10:35GMT, while at 10:00GMT, the FxWirePro's Hourly Dollar Strength Index remained neutral at -3.58 (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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