NEW YORK: US Treasury yields fell on Tuesday as Greek Prime Minister Alexis Tsipras blamed an impasse in negotiations on disagreements among its international lenders, rattling stocks and increasing demand for safe-haven debt.
Greece is set to default on a 1.6 billion euro ($1.80 billion) debt repayment to the International Monetary Fund on June 30 unless it receives fresh funds by then. A default could drive it to exit the eurozone.
The German ZEW indicator of investor sentiment also came in below forecast on Tuesday, adding to concerns over the eurozone's economic prospects.
"We had the disappointing German ZEW release and ongoing jitters about the Greek situation," said Ian Lyngen, senior government bond strategist at CRT Capital in Stamford, Connecticut.
Benchmark 10-year notes were last up 9/32 in price to yield 2.33 percent, down from 2.36 percent late on Monday.
In the United States, the main focus is this week's two-day Federal Reserve meeting. Investors will scour Wednesday's statement after the meeting concludes for any new signs of when the Fed is likely to begin raising interest rates and the pace of any subsequent hikes.
The Fed will also release its latest forecasts for the economy and the federal funds rate on Wednesday.
"We would expect them to tweak the forecasts a little bit lower to reflect the bad first quarter, but not that much," said Lyngen.
Investors are also focused on whether the Fed will change language in the statement about ongoing slack in the labor market, after job gains beat expectations in May and wage inflation rose.
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