Treasuries Extend Weekly Advance After U.S. Stock-Index Futures Decline

(Bloomberg) -- Treasuries extended gains for the
week after U.S. stock-index futures declined.

The yield on the 10-year note fell 1 basis point, or 0.01
percentage point, to 4.78 percent at 7:23 a.m. in New York,
according to data compiled by Bloomberg. The price of the 4 1/2
percent bond due May 2017 rose 3/32, or 94 cents per $1,000 face
amount, to 97 27/32. Yields move inversely to bond prices.


Read more at Bloomberg Bonds News

Dollar Trades Near Record Low Before Inflation, Treasury Holdings Reports

(Bloomberg) -- The dollar traded near a record low
against the euro before U.S. government reports that economists
forecast will show slowing inflation and waning foreign demand
for U.S. securities.

Yields on 10-year Treasury notes yesterday fell for a
second day, diminishing the appeal of holding dollar-denominated
assets. Traders have stepped up bets the Federal Reserve will
cut interest rates before Chairman Ben S. Bernanke delivers
testimony before the House Financial Services Committee tomorrow.


Read more at Bloomberg Currencies News

China, Malaysia, South Korea, Thailand, India: Asia Local Bond Preview

(Bloomberg) -- The following events and economic
reports may influence trading in Asian local-currency bonds
today. Yields are from the previous session.

China: China Development Bank sold 20 billion yuan ($2.63
billion) of 10-year floating rate bonds yesterday. The coupon
was one-year deposit rate of 3.06 percent plus 89 basis points.
Ten-year bonds sold in May carried a coupon of 60 basis points
more than the one-year deposit rate. The Ministry of Finance
will sell 35 billion yuan of three-year fixed-rate notes on July
13.


Read more at Bloomberg Bonds News

India, Singapore, Sri Lanka, Malaysia, Thailand: Asia Local Bond Preview

(Bloomberg) -- The following events and economic
reports may influence trading in Asian local-currency bonds
today. Yields are from the previous session.

China: China Development Bank will auction 20 billion yuan
($2.6 billion) of 10-year floating rate bonds tomorrow at an
interest rate based on a spread over the one-year deposit rate.
The Ministry of Finance will sell 35 billion yuan of three-year
fixed-rate notes on July 13.


Read more at Bloomberg Bonds News

Treasury Note Yields Climb Most Since March 2006 on Job, Production Growth

(Bloomberg) -- Yields on benchmark 10-year Treasury
notes increased the most in more than a year after reports
showed better-than-expected gains in employment, manufacturing
and service industries.

Government statistics next week are expected to show a
rebound in consumer confidence and that weekly claims for
jobless benefits remain at a level indicating strength in the
labor market. Interest-rate futures show traders pared bets the
Federal Reserve will cut interest rates this year.


Read more at Bloomberg Bonds News

S.Africa government bonds firmer on stronger rand

(Reuters) - South African government bonds strengthened on Monday as the rand currency maintained a firm bias against the dollar.

Yields on the most-active 2010 bond fell 14 basis points from Friday's closing levels to 8.955 percent, while those on the benchmark issue due in 2015 went down by 14.5 basis points to 8.355 percent.


Read more at Reuters Africa

European Government Bond Rally May Stall on View Interest Rates Will Rise

(Bloomberg) -- European bonds may drop, snapping
their longest winning run in two months, as expectations the
European Central Bank will lift interest rates outweigh
speculation a weaker U.S. house market will slow global growth.

Yields on 10-year bunds may rise from a three-week low as
investors bet on two more interest-rate increases by the ECB.
Euro-region money supply growth probably held near the fastest in
24 years in May, a Bloomberg survey showed. The Federal Reserve
will probably keep its key rate on hold today citing inflation,
which may halt debt market gains worldwide.


Read more at Bloomberg Bonds News

China, Indonesia, Malaysia, South Korea, Taiwan: Asian Local Bond Preview

(Bloomberg) -- The following events and economic
reports may influence trading in Asian local-currency bonds
today. Yields are from the previous session.

China: The inflation rate may climb to about 3.3 percent in
2007 because of rising food costs, the China Securities Journal
said yesterday, citing the State Information Center, which is
linked to the National Development and Reform Commission,
China's top planning body. Consumer prices rose 1.5 percent in
2006. The government will sell 30 billion yuan ($3.9 billion) of
10-year bonds tomorrow. It sold the same maturity at a yield of
3.4 percent on March 21.


Read more at Bloomberg Bonds News

Mexican 10-Year Peso Bonds Climb to Two-Week High on Tax Bill Prospects

(Bloomberg) -- Mexico's 10-year peso-denominated
bonds rose, pushing yields to the lowest in two weeks, on
speculation President Felipe Calderon will push his plan to raise
tax collection through congress.

Yields on the 10-year maturity fell for a fourth day and the
peso strengthened as Calderon said he'll unveil his tax overhaul
proposal in the next few days.


Read more at Bloomberg Emerging Markets News

European Bonds Extend Losses as Central Banks Prepare to Raise Rates

(Bloomberg) -- European government bonds fell on
speculation that global interest rates are set to rise further.

The yield on the benchmark two-year note touched the highest
in more than six years yesterday as traders increased bets the
European Central Bank would lift rates twice more this year.
Yields on 10-year Treasury notes climbed to the highest in five
years yesterday as former Federal Reserve Chairman Alan Greenspan
predicted an increase in benchmark yields and greater premiums on
emerging-market debt.


Read more at Bloomberg Bonds News

Japan's Government Bonds Decline for Ninth Day on Slump in U.S. Treasuries

(Bloomberg) -- Japan's government bonds fell for a
ninth day, the longest slide in three years, after former Federal
Reserve Chairman Alan Greenspan predicted declines in U.S. and
emerging market debt.

``Bond yields are rising globally and Japan is catching up,''
said Masuhisa Kobayashi, chief Japan bond strategist at Barclays
Capital Japan in Tokyo. ``Yields look like they are pricing in an
expectation for a rate increase, which gives a good excuse for the
central bank in Japan to raise rates in coming months.''


Read more at Bloomberg Bonds News

China, India, Thailand, South Korea, Indonesia: Asia Local Bond Preview

(Bloomberg) -- The following events and economic
reports may influence trading in Asian local-currency bonds
today. Yields are from the previous session.

China: consumer prices gained 3.3 percent in May from a
year earlier, according to the median estimate of 19 economists
surveyed by Bloomberg News before a government report today.
April's inflation rate was 3 percent, matching the central
bank's 2007 target. China Development Bank sold 20 billion yuan
($2.6 billion) of five-year bonds at a higher-than-expected
yield of 4 percent yesterday.


Read more at Bloomberg Bonds News

Bond slump worsens as yields race above 5 pct

(Reuters) - Yields across all maturities rose to or above 5 percent for the first time since July and benchmark rates posted their biggest one-day spike in seven months.




Ten-year notes dived 26/32 in price, pushing yields a full 10 basis points to 5.10 percent. The 30-year bond tumbled a gaping 1-13/32, a drop exacerbated by selling from mortgage investors.


Read more at Reuters.com Business News

European 10-Year Government Bond Yield Rises to Highest Since 2003 on ECB

(Bloomberg) -- European government bonds declined,
pushing benchmark 10-year yields to the highest since 2003, on
speculation the European Central Bank will lift interest rates
tomorrow and signal further increases this year.

Yields on two-year notes, more sensitive to interest-rate
expectations, also reached a six-year high after a report today
showed expansion in European service industries picked up in May,
adding to the case for higher rates.


Read more at Bloomberg Bonds News

Philippine Government Bonds Fall on Inflation Data: World's Biggest Mover

(Bloomberg) -- Philippine bonds slumped, the biggest
fluctuation of any government debt market today, after a report
showed inflation accelerated for a second straight month. The
peso weakened.

Yields on five-year notes rose to the highest since
December on speculation quickening inflation, supported by
rising oil prices, will give the central bank less room to
reduce interest rates. The economy grew a faster-than-expected
6.9 percent last quarter, curbing speculation policy makers will
reduce borrowing costs.


Read more at Bloomberg Bonds News

Japan's Five-Year Notes Fall; Yields Rise to 11-Month High as Stocks Gain

(Bloomberg) -- Japan's government notes fell,
pushing five-year yields to the highest in 11 months, on
speculation a gain in share prices will cut demand for debt.

Yields on five-year notes have climbed faster than those on
10-year securities since the start of last month on increasing
concern the Bank of Japan will raise borrowing costs again this
year. The Nikkei 225 Stock Average advanced for a fourth day,
the longest stretch since March.


Read more at Bloomberg Bonds News

Japan's Five-Year Government Notes Drop, Have Worst Month Since March 2006

(Bloomberg) -- Japan's five-year government notes had
the biggest monthly decline in more than a year on speculation
advancing stocks will back the case for the central bank to raise
interest rates this year.

Government reports this week showed the jobless rate dropped
to a nine-year low and households increased spending for a fourth
month. Bank of Japan policy board member Kiyohiko Nishimura said
the market ``appears to be factoring in future rate adjustments
in a gradual manner.'' Yields on two-year notes climbed to the
highest in almost a decade as the Nikkei 225 Stock Average rose
to a three-month high.


Read more at Bloomberg Bonds News

Brazilian Real Falls as Rise in U.S. Yields Saps Demand for Risky Assets

(Bloomberg) -- Brazil's real weakened for a third
day as rising U.S. bond yields cut into demand for riskier,
emerging-market securities.

The real slid as much as 0.7 percent today after the yield
on benchmark U.S. 10-year bonds rose 23 basis points, or 0.23
percentage point, this month to 4.86 percent. Yields are rising
in the world's biggest economy, narrowing the gap between U.S.
and Brazilian yields, as speculation fades that the Federal
Reserve will cut interest rates.


Read more at Bloomberg Currencies News

Subprime Mortgage Bonds Rally on CDO Demand, Better Underwriting of Loans

(Bloomberg) -- Bonds backed by subprime U.S.
mortgages are rallying as lenders tighten their underwriting
standards and demand increases from managers needing the
securities to fill collateralized debt obligations.

Yields relative to benchmarks on some of the debt have
fallen from record highs in February and March, when investors
fled the securities amid rising delinquencies on home loans made
to people with poor credit. So-called spreads on new BBB rated
bonds have tightened 1.25 percentage points to 2.75 percentage
points in the past month, according to Deutsche Bank AG.


Read more at Bloomberg Bonds News

Treasuries Drop, Pushing Yields to Near Three-Month Highs on U.S. Economy

(Bloomberg) -- Treasuries fell, pushing two-year
yields to near three-month highs on expectations reports this
week will show the U.S. economy is gathering momentum.

Yields on the notes, the most sensitive to changes in
interest-rate expectations, have risen 8 basis points in the
past week as traders reduced bets the Federal Reserve will cut
interest rates this year. Richmond Fed President Jeffrey Lacker
said today he is still worried about inflation.


Read more at Bloomberg Bonds News