TOKYO: US Treasuries firmed in Asia on Monday, with the benchmark yield edging further away from 2 percent as investors' appetite for risk faded on new worries about the European debt crisis.
The yield on Spain's benchmark government bond soared on Friday after data showed Spanish banks borrowed heavily from the European Central Bank in March, reviving concerns over struggling euro zone countries' ability to finance their debt.
The US Federal Reserve will meet on April 24-25, and it is not expected to take any new policy steps, though several Fed officials who spoke late last week did not rule out more monetary stimulus in the future if the economy were to need it.
"The Fed isn't expected to come up with any new policy moves, but worries about the situation in Europe are taking the spotlight away from questions about the US economy," said a fixed income fund manager at a Japanese bank in Tokyo.
The yield on the 10-year notes fell to 1.97 percent from 1.99 percent in late US trade. It was at 2.02 percent in Asian trade on Friday.
The 30-year bond yield edged down to 3.13 percent, from 3.14 percent in late US trading. It was at 3.18 percent in Asia on Friday.
On Friday, the US Federal Reserve bought $1.833 billion of Treasuries maturing February 2036 through August 2041 as part of its "Operation Twist" stimulus programme.
Last week, the government sold $66 billion in 3-year and 10-year notes and 30-year bonds.
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