Treasury prices change little as US data mixed

Treasury prices change little as US data mixed

The sale followed a well-received auction of 2-year debt on Monday. The Treasury will complete this week’s coupon debt offering on Wednesday with a $ 29 billion sale of new seven-year notes.

Benchmark yields have been stuck in a narrow 7 basis point range after they fell to a three-month low of 2.471 percent last Wednesday in the wake of a disappointing September jobs report.

“The market is directionless. There is no urgency to push yields higher or lower,” said Lou Brien, a market strategist at DRW Trading in Chicago.

Economic data did little to point the way for investors. While an a S&P/Case-Shiller report showed the biggest year-over-year home price increase in seven years, consumer confidence sagged badly in October.

And the Commerce Department said a hefty drop in car demand led to a surprise 0.1 percent dip in retail sales in September.

The Federal Reserve meeting that concludes on Wednesday could continue the status quo.

The Federal Open Market Committee, the central bank’s policy-setting group, will probably maintain their current pace of bond-buying in a bid to prop up the economy after a federal government shutdown earlier this month, which dragged on the world’s biggest economy.

“The FOMC statement will be purposely bland,” said Jim Vogel, an interest rates strategist with FTN Financial in Memphis, Tennessee.

The impasse in Congress that led to the shutdown highlighted the political risk overshadowing markets now, a worry that could make the Fed reluctant to pull back now.

“It’s going to be hard for the Fed to do much of anything other than what they’re doing until March of next year, maybe even April of next year,” said Kevin Giddis, head of fixed income capital markets at Raymond James in Memphis, Tennessee. The effects of a divided Congress, he said, “are a lot more punitive to the economy.”

—Reuters

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