SINGAPORE: US 10-year Treasuries eased slightly in Asia on Wednesday, staying on the defensive after the Dow Jones industrial average hit record highs the previous day, dampening demand for bonds.
Ten-year Treasuries slipped about 1/32 in price to yield 1.903 percent, up roughly 1 basis point from late US trade on Tuesday. The 10-year yield hovered near the top end of its 1.912 percent to 1.827 percent range seen over the past week.
On Tuesday, the Dow Jones industrial average hit a record intraday high and also set a record closing high, bringing its gains so far this year to nearly 9 percent.
Still, when taking into account the potential economic impact from the across-the-board government spending cuts that came into effect last week, it is hard to think that the 10-year Treasury yield will head sharply higher, said Tomohisa Fujiki, interest rate strategist for BNP Paribas in Tokyo.
"The US economy isn't doing too badly... But there could eventually be downward pressure on employment," Fujiki said, referring to the potential economic impact from the government spending cuts.
The 10-year Treasury yield will probably move in a range of roughly 2.0 percent to 1.8 percent over the next month, he added.
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