Treasury 30-year bonds advanced before a $16 billion sale of the securities as investors sought the safest assets amid concern the euro region’s debt crisis isn’t yet resolved.
Treasuries rose, pushing yields toward a three-week low, as stock losses and violence in Libya bolstered demand for the safest assets.
Confidence in Prime Minister Shinzo Abe’s stimulus policies is faltering after foreign investors sold $24.2 billion of Japanese shares this year, leaving them the cheapest relative to bonds in 18 months.
Treasuries headed for a third weekly gain before a U.S. report that economists said will show manufacturing grew at the slowest pace in 10 months in September.
U.S. five-year notes led the Treasury market toward a monthly gain before a Commerce Department report that analysts said will show U.S. economic growth slowed in the second quarter.
"The market has become complacent about risks as monetary easing continues."
- Satoshi Okumoto on Aug 12, 2014