U.S. Treasuries tad down ahead of 7-year auction, FOMC policy meeting

The U.S. Treasuries traded tad down during Tuesday’s afternoon session ahead of the country’s 7-year auction, scheduled to be held today by 18:00GMT. However, of utmost importance will be the Federal Reserve’s monetary policy meeting, due to be concluded on January 29 by 19:00GMT, which shall pave the way for future direction in the debt market.

The yield on the benchmark 10-year Treasury yield lost 1 basis point to 1.594 percent, the super-long 30-year bond yield also edged tad 1 basis point down to 2.043 percent and the yield on the short-term 2-year remained 1-1/2 basis points down at 1.419 percent by 11:45GMT.

In the US, December durable goods orders, due for release today are expected to be up 0.8 percent, following a 2.1 percent fall in November. Much of the rebound is due to stronger aerospace orders. These, however, can be very volatile. A better gauge of the underlying picture is provided by the ex-transport reading, which is forecast to rise by 0.5 percent after a 0.1 percent fall, Lloyds Bank reported.

The US-China trade deal suggests that 2020 may be a better year for the industrial sector. One area of concern, however, is aerospace, where Boeing’s problems may lead to production cutbacks, the report added.

Meanwhile, the S&P 500 Futures remained nearly flat at 3,243.12 by 11:50GMT.