NEW YORK: US Treasury debt prices rose on Thursday as investors awaited clues on the path of monetary policy from a Senate panel hearing on Federal Reserve Vice Chair Janet Yellen's nomination to head the US central bank.
After Yellen's hearing, investors will contend with the last leg of this week's $70 billion quarterly refunding with a $16 billion sale of 30-year bonds at 1 p.m. EST (1800 GMT).
The 30-year supply follows back-to-back solid auctions of three-year and 10-year notes on Tuesday and Wednesday.
"Today is all about Yellen and whether she stays on the dovish side," said Jason Rogan, managing director of Treasuries trading at Guggenheim Partners in New York.
Investors view Yellen, along with out-going Fed Chairman Ben Bernanke, as a strong proponent of the Fed's current ultra-loose monetary policy. They reckon a Fed under Yellen's leadership will continue this stimulative stand with the goal to lower unemployment and to raise inflation.
"I believe that supporting the recovery today is the surest path to returning to a more normal approach to monetary policy," Yellen said in her prepared remarks released late Wednesday.
The remarks were to be delivered at her confirmation hearing before the Senate Banking Committee which will begin at 10 a.m. EST (1500 GMT).
Benchmark yields fell as low as 2.70 percent late Thursday after the release of those prepared remarks, which analysts considered bond-market friendly.
Yields have since retraced slightly higher and have settled in a very narrow 4 basis point trading range.
Rogan and other analysts attributed the market gains largely to traders exiting bets on lower prices spurred by an encouraging jobs report last Friday, rather than a wave of bullish bets on Treasuries.
Since her prepared remarks are known, traders will track Yellen's replies to likely questions on quantitative easing and interest rate outlook from the Senate panel.
"People are waiting to see whether she will continue on a dovish path from her prepared remarks or she might backtrack," Rogan said.
On the open market, benchmark 10-year Treasury notes were 5/32 higher in price with a yield of 2.732 percent, down 2 basis points from late on Wednesday.
Thirty-year bonds were up 11/32 for a yield of 3.808 percent, down 2 basis points from Wednesday's close.
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