Treasury 10-year notes rose for the first time in five days as yields at almost a two-year high drew buyers betting the securities have already priced in an improving U.S. economy and an end to Federal Reserve bond purchases in 2014.
Treasuries advanced as a report showed sales of previously owned U.S. homes rose less than forecast in November, and as investors bought U.S. bonds to match market indexes. Gains were tempered before data tomorrow that are forecast to show consumer confidence rose in December. U.S. employers added 190,000 workers this month after hiring 203,000 in November, economists said a report next week may show. U.S. government securities headed for the first annual loss since 2009.
“The 10-year seems unable to sustainably break through the 3 percent level as we head into year-end,” said Ian Lyngen, a government-bond strategist at CRT Capital Group LLC in Stamford, Connecticut.
The 10-year yield fell two basis points, or 0.02 percentage point, to 2.98 percent at 10:04 a.m. New York time, according to Bloomberg Bond Trader prices. It climbed to 3.02 percent on Dec. 27, the highest since July 2011.
A gauge of pending home sales increased 0.2 percent, the first gain in six months, after a 1.2 percent drop in October that was larger than initially reported, the National Association of Realtors said today in Washington. The median projection in a Bloomberg survey of economists called for a 1 percent advance.
The Securities Industry and Financial Markets Association recommends U.S. Treasuries trading close tomorrow at 2 p.m. in New York and remain shut on Jan. 1.