SINGAPORE: US 10-year Treasuries rose on Wednesday, getting some respite from a recent sell-off that came as the Federal Reserve's new monetary stimulus bolstered inflation expectations and whetted investor appetite for risky assets.
Ten-year Treasuries rose 4/32 in price to yield roughly 1.798 percent, down 1 basis point from late US trade on Tuesday and below a four-month high around 1.89 percent hit on Friday.
The 10-year notes have regained some footing after Friday's sharp sell-off, which took place a day after the Fed said it would pump $40 billion into the US economy each month until it saw a sustained upturn in the jobs market.
In the wake of the Fed's decision to embark on aggressive monetary stimulus, 10-year Treasuries may retreat further over the next several months, said Tomohisa Fujiki, interest rate strategist for BNP Paribas Securities in Tokyo.
"Previously, we had expected the 10-year yield to come in at 1.35 percent at year-end, but we are now looking for 2 percent at the end of the year," he said.
Investors will now turn their focus to US indicators such as jobs data to gauge the economic impact of the Fed's monetary stimulus, Fujiki said, adding that developments related to the euro zone's sovereign debt crisis will also garner attention.
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