Treasury 30-year bonds rose, with yields falling to the lowest level since June, as speculation of increased monetary accommodation in Europe added to pressure on traders betting on higher U.S. interest rates.
Treasuries dropped for a second day before a government report on Feb. 7 that’s forecast to show nonfarm payrolls increased in January, boosting the case for the Federal Reserve to keep reducing its bond purchase program.
Treasuries slid, sending 30-year yields to the highest level since May, amid increased criticism of the Federal Reserve’s plan to stimulate growth and concern that a swelling U.S. deficit will lead to higher borrowing costs. U.S. stocks erased gains and the dollar rallied.
Rates on Treasury bills maturing in November and December jumped for a second day as officials in Washington worked on a short-term budget agreement that may push the possibility of a default back six weeks.