NEW YORK: US Treasury prices fell on Tuesday although month-end buying was seen as stemming weakness, and the market also stayed within its recent range before Friday's highly anticipated jobs report for September.
Treasuries have oscillated from weakness on Friday to gains on Monday amid concerns that asset manager Pimco may need to liquidate positions if investor redemptions increase after the departure of co-founder Bill Gross.
There was little evidence that liquidations were affecting the market, however. Many investors remained focused on Friday's employment report and the European Central Bank meeting on Thursday as the primary market drivers in the near term.
"There is a lot of chatter about Bill Gross and the Pimco story, but it's unclear to me that there is anything specific about that that is driving today's flows," said Ian Lyngen, senior government bond strategist at CRT Capital in Stamford, Connecticut.
Month-end demand for Treasuries was also seen as capping weakness.
Benchmark 10-year notes were last down 3/32 in price to yield 2.50 percent, up from 2.49 percent late on Monday.
The New York Federal Reserve also saw record demand for Treasuries in its reverse repurchase agreement operation, leading it to lend the debt for free for the first time.
The operation had $407 billion in bids, but only $300 billion, the daily limit, were accepted. Bids for the debt ranged from a high of 5 basis points to negative 20 basis points.
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