Treasuries were set for the steepest weekly decline this year amid speculation a U.S. jobs report today will strengthen the case for the Federal Reserve to push ahead with tapering its monetary stimulus program.
Portugal’s two-year notes rose for a third day after the nation said yesterday it will buy back debt as it works toward exiting its bailout program, adding to evidence the euro area is putting the debt crisis behind it.
Treasuries were near the cheapest versus international peers in seven years before a jobs report that may signal whether the recovery is strong enough for the Federal Reserve to accelerate its tapering of stimulus.
Treasuries fell for a second day on speculation the Federal Reserve will reduce monetary stimulus this week and as a recovery in emerging-market equities from a three-day slump damped demand for the safest assets.
Treasuries are having their best start to a year since 2010 as investors from Jeffrey Gundlach to Goldman Sachs Group Inc. say the Federal Reserve will keep its benchmark interest rate at almost zero into 2016.
Italy’s government bonds rose for a second day as a survey of purchasing managers showed euro-area manufacturing and services grew more in December than economists forecast, boosting demand for higher-yielding assets.
Treasuries advanced, pushing 10-year yields down from the highest in almost a month, as stock-market losses and speculation that European banks will struggle to raise funds boosted demand for the safety of fixed income.