Bonds Trim Losses

U.S. Treasuries pared early losses Tuesday as stocks trimmed gains. Treasuries were pressured on rising global inflation measures and equities while later domestic manufacturing and construction data beat expectations. The mid-curve has been hit hardest while the two- and 30-year wings outperform. Treasuries have continued to suffer in the face of expected upticks in inflation, fiscal spending and increased debt supply.

The 30-year recently traded near 3.075% from a 3.133% high yield/low price and 3.05% close Friday. The 10-year is near 2.479% versus a 2.5163% low and close near 2.43%. The five-year is stalled near 1.975% from a 2.0065% low and close near 1.92%. The two-year is near 1.24% from a 1.258% low and a 1.20% Friday.

The curve trade remains mixed with the yield differential between the two- and 10-years steepened to near 1.25 from near 1.23 Friday while the spread between the five- and 30-year yields flattened to 1.10 plus from a close near 1.13.

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