RTRS: TREASURIES-Prices edge up before two-year note sale
* ECB chief Draghi not attending Jackson Hole event
* U.S. to sell $35 billion in two-year notes
* Consumer confidence, Case-Shiller home data on tap
* Fed to buy $4.50 billion to $5.5 billion Treasuries
By Richard Leong
NEW YORK, Aug 28 (Reuters) - U.S. Treasuries prices clawed
higher on Tuesday ahead of a sale of $35 billion of two-year
notes as traders anticipated hints from Federal Reserve Chairman
Ben Bernanke of possible further monetary stimulus to help the
economy.
Bets on a third round of 'quantitative easing' through
large-scale bond purchases, nicknamed QE3, pushed benchmark
yields to two-week lows after they touched a three-month high
last week.
"They have to come up with something fresh and whether
something might be coming in September," said Sean Murphy, a
Treasuries trader at Societe Generale in New York.
Benchmark 10-year notes were up 5/32 in price at
99-29/32 to yield 1.635 percent, down 1.7 basis points from late
on Monday.
Treasury yields held at current levels partly on selling
from investors making room for this week's $99 billion of new
coupon supply, mitigating bets on more Fed stimulus.
Bernanke was scheduled to deliver a speech on Friday at a
meeting of global central bankers in Jackson Hole, Wyoming. He
has the previous two years signaled the central bank's intention
on more easing at this event.
However, Bernanke's counterpart at the European Central
Bank, Mario Draghi, will not attend the annual gathering, citing
heavy workload.
Traders had looked forward to a speech from Draghi on clues
on how European policy-makers are tackling the problems of
Greece, Spain, Italy and other debt-laden euro zone members.
On the domestic data front, traders will receive the latest
figures on home prices from Standard & Poor's/Case-Shiller and
consumer confidence from the Conference Board.
Economists expected these data to show some stabilization in
the housing and consumer sectors which have been bogged down by
high unemployment and the lingering effects of the credit
crisis.
Separately, the Fed is scheduled to buy $4.50 billion to
$5.5 billion in government debt that matures in Nov 2020 to Aug
2022 at 11 a.m. (1500 GMT). This is the latest part of its
"Operation Twist" aimed at holding down long-term borrowing
costs.
