TOKYO: US Treasuries held steady in Asia on Thursday after dipping on a move by six central banks to prevent a global credit crunch stemming from Europe.
Ten-year notes inched up 1/32 in price to yield 2.07 percent, almost unchanged from late US levels.
Central banks from the United States, the euro zone, Canada, Britain, Japan and Switzerland lowered the cost of dollar loans to the banking system.
Market players were sceptical the move on its own would be enough to prop up yields for long, since it is aimed at easing the symptoms of the euro zone's debt crisis rather than treating the cause.
"That's why all eyes are on the ECB right now and its policy meeting next Thursday. The bank is likely to take action -- lower rates or collaborate with the IMF on support for cash-strapped countries -- and we may see the risk rally extend," said Arihiro Nagata, manager of foreign bond trading at Sumitomo Mitsui Banking Corp.
Piling more pressure on the bank, the Polish EU presidency said on Wednesday that EU finance ministers expect it to step in forcefully to calm bond markets if EU leaders agree to move towards fiscal union at a summit on December 9.
A relief-rally in yields was also supported by some good news from the US with better-than-expected US economic data, such as private payrolls, manufacturing and home sales.
"But if the ECB fails to step in, we'll likely see the yields (on 10-year bonds) dip below 2 percent again," Nagata said.
Ten-year yields have been locked in a range of 15 basis points on either side of 2 percent since the beginning of November as investors closely monitor developments in Europe.
The Treasury Department announces weekly 3- and 6-month bill sales at 1600 GMT.
The Institute for Supply Management releases its November manufacturing index at 1500 GMT. Economists in a Reuters survey expect a reading of 51.5 versus 50.8 in October.
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