That came after Treasury Secretary Steven Mnuchin said in an interview with Bloomberg Television on Monday that his department was looking into the issuance of bonds with maturities beyond 30 years. "I think a lot of people were expecting the Treasury to commit to an ultra-long issue and they basically said that they're reviewing it but remaining non-committal," said Gennadiy Goldberg, interest rate strategist at TD Securities in New York.
Thirty-year bonds were last up 20/32 in price to yield 2.95 percent, down from 2.99 percent earlier. Benchmark 10-year notes gained 2/32 in price to yield 2.29 percent, down from 2.30 percent on Tuesday. The yield curve between 5-year notes and 30-year bonds flattened to 113 basis points, from 117 basis points earlier on Wednesday.
The Treasury also kept the size of its 10-year and 30-year bond sales planned for next week unchanged, after some investors had expected these issues would be increased. The Treasury said it will sell $62 billion in coupon debt next week, including $24 billion in 3-year notes, $23 billion in 10-year notes and $15 billion in 30-year bonds. Bonds showed little reaction to a report by payrolls processor ADP showing that US private employers added 177,000 jobs in April, slightly above economists' expectations.
Copyright Reuters, 2017