NEW YORK: US Treasuries prices fell on Thursday, pulling benchmark yields up from three-month lows, as the flow of bad news from Europe eased and a lower-than-expected number of claims for US jobless benefits dimmed the allure of low-risk government bonds.
The lack of safe-haven buying weighed on long-bond prices before the Treasury's offering of 30-year debt at 1 p.m. It kept 10-year yields above three-month lows near 1.80 percent after the market failed to push decisively through resistance there on Wednesday.
Spain's government effectively took over one of its largest banks in a bid to end a four-year crisis in the country's financial sector, and Greece averted a funding crisis by gaining approval for the latest tranche of bailout money, stanching the negative news flow.
But even with the slight dip in US jobless claims in Thursday's data, investors remained cautious especially as Greece faced the prospect of fresh elections after Sunday's vote produced a parliament divided over the terms of its financial bailout.
"That flight to quality into Treasuries is coming off a little bit," said Daniel Pavilonis, senior commodities broker at RJO Futures, in Chicago.
"Ahead of these auctions people want to kind of step aside because rates are already so low as it is."
Thirty-year bonds last trading down 1 point in price, yielding 3.08 percent versus Wednesday's close of 3.03 percent.
Thursday's $16 billion auction of 30-year bonds will complete the $72 billion of debt sales this week under the Treasury's quarterly refunding.
The bond yield in the when-issued market, considered a proxy for where the high yield will come in at the auction, was trading near 3.09 percent.
Yields on 10-year Spanish debt dipped on Thursday but were right around the 6 percent level that usually generates concerns about the country's ability to sustainably finance its debts.
The yield on the new benchmark 10-year note was trading at 1.90 percent versus the high yield of 1.855 percent at Wednesday's auction.
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