By Deborah Levine, MarketWatch
NEW YORK (MarketWatch) — Treasury prices edged down Monday, pushing long-term yields up for the fourth day in five, as concerns about Greece’s ability to get private debt holders to sign off on a bond swap took center stage.
Yields on 10-year notes 10_YEAR +0.86% , which move inversely to prices, rose 2 basis points to 1.99%. A basis point is one-hundredth of a percentage point.
Yields on 30-year notes 30_YEAR +0.51% rose 2 basis points 3.12%.
Yields on 5-year notes 5_YEAR +2.14% added 2 basis points to 0.86%, climbing back towards its highest levels this year.
Analysts also noted that bond volume was rather small compared to recent trading sessions.
As for U.S. data, the ISM’s services sector index is due at 10 a.m. Eastern time.
Greece’s investors have until Thursday to tender outstanding bonds, with various cut-offs in the participation rate being watched as indications whether the swap is voluntary versus forced. See more about Greek debt swap.
“Tail risks continue to abate (and are no longer considered close to base case by most investors), and this improvement should help realign the rates market with economic fundamentals,” said strategists at Nomura Securities. “We look for a near-term target of 2.18%” on 10-year yields.
Still, the decline was limited as other markets focused on an announcement from Chinese officials that they lowered their annual growth target. Read about China’s growth target.
U.S. equity futures pointed lower as the change count point to lower growth for the global economy.
“It’s less ‘risk-off’ and more ‘growth-off’ in the markets,” said Bill O’Donnell and John Briggs, bond strategists at RBS Securities. “With the U.S. recovery uneven and European growth constantly at risk, this is not a time markets want to see the engine of global growth slowing down, even if it is good for the long term.”
