TOKYO: US Treasuries steadied in Asia on Wednesday after a small rise the previous session, with further advance blocked by hopes Washington policymakers will give a green light to a measure to extend the US debt limit for nearly four months.
Treasuries rose slightly on Tuesday on a lower-than-expected reading in the headline US existing home sales, although the data showed no sign of change in an underlying recovery trend in the housing market.
The National Association of Realtors said on Tuesday that US existing home sales dropped 1.0 percent last month to a seasonally adjusted annual rate of 4.94 million units, below the median forecast of a 5.1 million-unit rate in a Reuters poll.
With US shares hitting a five-year high on cautious optimism that the US economy is on the mend, investors were reluctant to bid up Treasuries further.
Treasuries were also capped as Washington moved closer to "suspend" the debt ceiling, allaying concerns the US government could misses payment in the near future, thus causing a major disruption in the economy.
A bill put forward by Republicans on temporarily extending the US debt-limit is due to come to a vote in the Republican-controlled House of Representatives on Wednesday.
The debt ceiling is by no means the only issue Washington needs to tackle, with other fiscal deadlines looming, including a March 1 launch of automatic spending cuts and a March 27 expiration of funding for government agencies and programs.
Concerns about possible automatic spending cuts should continue to provide some support to US Treasuries in coming weeks, analysts said.
The 10-year notes traded at a yield of 1.847 percent , little changed from late US levels.
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