Forex trading store

By Burton Frierson

NEW YORK, May 28 (Reuters) – U.S. management bonds rallied

on Friday and were on track for their strongest month in within a little

a year and a half as poor consumer spending data and a

downgrade of Spain’s credit rating supported sure-haven

Treasuries.

Credit ratings agency Fitch’s downgrade of Spain reminded

investors the euro region’s fiscal troubles were the driver

behind this month’s come into order as global investors sought shelter in

Treasuries. For details see.

U.S. consumer expenditure was unexpectedly flat in April after

six straight months of gains. The given conditions hurt risky assets such

as stocks that do well in spells of economic growth but helped

Treasuries.

The weak economic data dovetailed by the Fitch news, both

of which supported bonds, and combined by both the usual

month-end Treasuries buying and a desire to withhold safe-haven

assets on hand for the three-day weekend.

‘There’s a true strong bid for the Treasury market for a

number of reasons including month-cessation and long weekend and

general risk aversion,’ said Bulent Baygun, leader of U.S.

interest rate strategy at BNP Paribas in New York.

‘Spain centre of life downgraded caused an immediate knee-jerk

reaction.’

The benchmark U.S. 10-year short letter was last up

22/32 in price, yielding 3.29 percent versus Thursday’s close

of 3.37 percent.

Based on the drop in yield, 10-year notes had their best

month since December 2008, at the time that financial markets were in deep

turmoil.

May’s performance barely subdue March 2009′s 35 basis-point

drop, the month the Federal Reserve announced it would buy

Treasuries under a program of asset purchases aimed at holding

the floor interest rates throughout the economy.

Highlights in this month’s Treasuries satirize include gains

on Tuesday that pushed 10-year yields down in the same manner with far as 3.06

percent, their lowest since the end of April remain year.

The 30-year long bond gained a point on the

~light. It was last up 1-1/32 in price, yielding 4.20 percent

versus Thursday’s close of 4.26 percent.

Fitch cut Spain’s credit ratings to AA+ from AAA without interrupti~ Friday,

saying its economic recovery would be more muted than the

administration forecast, pushing world equities and the euro

lower.

The downgrade follows a cut by Standard and Poor’s last

month and heaps more grievance on the government, battling to

reassure markets its fiscal, political and communicative woes will not

end up in a Greek-style debt turning point.

The previous downgrade and ongoing crisis in the euro zone

may regard softened the bond market’s reaction to the news,

though it did effect Treasuries to extend their gains slightly.

‘It’s almost a nonevent,’ before-mentioned John Spinello, Treasury bond

strategist at Jefferies & Co in New York.

‘Everybody knows the stipulations. I don’t know why they

chose this moment to show the downgrade.’

Trading was constrained by an early 2 p.m. (1800 GMT) conclusion

in the bond market, which comes ahead of Monday’s Memorial Day

holiday in the United States.

(Editing by James Dalgleish)

((burton.frierson@thomsonreuters.com; Tel: +1 646-223-6292;

Reuters Messaging: burton.frierson.reuters.com@reuters.without deductions))

Keywords: MARKETS BONDS ——-MARKET SNAPSHOT AT 2:24 p.m. EDT (1824 GMT)——- Sept T-Bond 122-27/32 (+15/32) Sept 10-Year catalogue 119-30/32 (+13/32) Change vs Current Nyk yield Three-month bills 0.16 (-0.01) 0.162 Six-month bills 0.22 (-0.01) 0.223 Two-year list of items 99-31/32 (+07/32) 0.774 Five-year note 100-04/32 (+15/32) 2.099 10-year official communication 101-21/32 (+15/32) 3.303 30-year bond 102-22/32 (+21/32) 4.216 —————————SWAPS SPREADS———————- May 28 May 27 May 26 May 25 May 24 May 21 2-YR 46.50 41.00 47.75 50.00 49.50 41.75 3-YR 42.50 38.00 42.25 44.00 42.25 36.00 5-YR 33.50 29.75 34.50 36.25 33.00 28.25 10-YR 8.25 8.75 8.75 9.00 6.75 4.50 30-YR -18.50 -17.50 -17.50 -18.25 -19.25 -19.75 Keywords: MARKETS BONDS

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