BLBG:Treasuries Head for Weekly Gain Before Spending Report
Treasuries rose, extending a second weekly gain, before a government report that economists said will show U.S. consumer spending stalled in August after adjusting for inflation.
Benchmark 10-year yields approached a three-week low as the U.S. economy slows and European leaders struggle to find ways to pay their nations’ debts. U.S. government securities returned 0.6 percent since the end of June, after gaining 3 percent in the second quarter, according to Bank of America Merrill Lynch indexes. Another U.S. report today is forecast to show growth in personal income slowed last month.
“I don’t think it’s too late to buy,” said Hiromasa Nakamura, who invests in U.S. debt from Tokyo at Mizuho Asset Management Co., which oversees the equivalent of $42.4 billion. “The economic situation is very weak.”
The 10-year yield fell two basis points, or 0.02 percentage point, to 1.64 percent at 8:36 a.m. in London, based on Bloomberg Bond Trader prices. The 1.625 percent note due in August 2022 rose 7/32, or $2.19 per $1,000 face amount, to 99 30/32. The yield dropped to 1.61 percent on Sept. 26, the lowest since Sept. 7. It declined 12 basis points this week.
Household purchases rose 0.5 percent after increasing 0.4 percent in July, according to the median estimate of economists surveyed by Bloomberg. The report may also show the gain reflected a 0.5 percent jump in prices, the biggest increase since June 2009.
To contact the reporter on this story: Anchalee Worrachate in London at aworrachate@bloomberg.net; Wes Goodman in Singapore at wgoodman@bloomberg.net.
To contact the editor responsible for this story: Paul Dobson at pdobson2@bloomberg.net
