Treasuries Little Changed on Signs of Slowing Expansion, Decline in Stocks

(Bloomberg) -- Treasuries were little changed as
Asian stocks slid and speculation increased that losses tied to
subprime mortgages will prompt the Federal Reserve to cut
interest rates this year.

Ten-year notes may extend their gains into a fifth week
after reports showed employers added fewer jobs than expected
last month and bond investors are becoming less bearish.
Treasuries are on track to return 5.3 percent this year, the
most since 2002, according to a Merrill Lynch & Co. index.


Read more at Bloomberg Bonds News

Bernanke May Alter Rhetoric, Not Interest Rates, After Market Turbulence

(Bloomberg) -- Federal Reserve Chairman Ben S.
Bernanke may respond to the latest squall in financial markets
the same way he did when turbulence hit four months ago: with a
change in words rather than policy.

Bernanke and his colleagues may suggest after their
meeting tomorrow that the risks to economic growth have
increased following the rout in stock and credit markets -- just
as they did after their March meeting.


Read more at Bloomberg Bonds News

US STOCKS-Futures rise before inflation, other data

(Reuters) - Shares of fast-food chain Wendy's International Inc.
will likely be in the spotlight after billionaire
Nelson Peltz said his Triarc Cos. Inc. could offer up
to $41 a share for the company. For details, see
[ID:nN30445780].




The core personal consumption expenditure index, the
Federal Reserve's favorite inflation indicator, is forecast to
have risen 0.2 percent in June, according to economists polled
by Reuters.


Read more at Reuters.com Bonds News

UPDATE 2-U.S. H1 foreclosures jump, trending higher-RealtyTrac

(Reuters) - The spike in foreclosures reported by RealtyTrac
underscored another problem plaguing the U.S. housing market,
which has also been struggling with falling demand and hefty
inventory.




Analysts and the Federal Reserve have cited the housing
problem, exacerbated by the subprime blowup, as the biggest
risk to economic growth. Bond traders are betting that the Fed
would begin cutting interest rates later this year to cushion
the economy from a housing-led slowdown.


Read more at Reuters.com Bonds News

Treasuries Head for Third Weekly Gain as Investors Avoid Riskier Assets

(Bloomberg) -- Treasuries headed for a third weekly
advance, pushing yields near the lowest since May, as the slump
in U.S. housing prompts investors to avoid riskier assets.

Investors seeking the safety of government debt this week
pushed yields on two-year notes, most sensitive to changing
monetary policy, 70 basis points lower than the Federal Reserve's
target rate. The risk of owning corporate bonds soared to a
record on concern that banks and hedge funds face widening losses
on subprime mortgages and leveraged buyouts.


Read more at Bloomberg Bonds News

Treasuries Snap Seven-Day Rally as Stocks Rise Before U.S. Reports Growth

(Bloomberg) -- Treasuries snapped a seven-day run
of gains as European shares and U.S. stock futures rebounded
before a report that's expected to show faster economic growth.

Bonds also pared a third weekly advance as technical charts
suggested the rally has been too rapid and some investors said a
U.S. housing slump won't prompt the Federal Reserve to cut
interest rates. The Commerce Department will probably say the
economy expanded at an annualized 3.2 percent pace, the fastest
in more than a year, according to a Bloomberg survey.


Read more at Bloomberg Bonds News

Dollar Declines to Lowest in Two Months on U.S. Subprime Mortgage Concerns

(Bloomberg) -- The dollar fell to the lowest in two
months against the yen on concern U.S. subprime mortgage losses
will worsen.

The U.S. currency weakened for a third day on prospects a
National Association of Realtors report tomorrow will show U.S.
existing-home sales dropped last month to the lowest in four
years. Federal Reserve Chairman Ben S. Bernanke testified before
Congress last week that there will be ``significant'' losses on
loans to homeowners with poor credit.


Read more at Bloomberg Currencies News

U.K. Pound Rises to Highest in 26 Years on Outlook for BOE Interest Rates

(Bloomberg) -- The pound rose to its strongest in
26 years against the dollar on speculation the Bank of England
will keep raising interest rates.

The highest benchmark bond yields of any Group of Seven
nation have lured investors from abroad and pushed up the pound.
A report last week showed the U.K.'s economic expansion
unexpectedly quickened in the second quarter, while the U.S.
Federal Reserve trimmed its forecast for growth.


Read more at Bloomberg Currencies News

Dollar's Record-Setting Tumble Turns Into Boon for George Bush, Coca-Cola

(Bloomberg) -- Everyone from Nobel Prize laureates
to the world's biggest bond investor says the Bush administration
has reason to cheer the dollar's slide to historic lows.

The currency has lost 13.2 percent since January 2001, when
George W. Bush took office, the most under any president since at
least Gerald Ford, who left the White House in 1977. That's based
on a Federal Reserve index that tracks the dollar against the
currencies of 38 U.S. trading partners, including Germany, Japan
and Canada.


Read more at Bloomberg Currencies News

Japan's Bonds Post Weekly Gain as Concern Rises About U.S. Subprime Losses

(Bloomberg) -- Japanese bonds posted the first
weekly gain this month amid speculation investors sought the
relative safety of government debt because of losses on
securities tied to U.S. mortgages.

The 10-year yield fell to the lowest since July 11 as U.S.
investment bank Bear Stearns Cos. told investors in its two
failed hedge funds that they will get little or no money back.
Federal Reserve Chairman Ben S. Bernanke said on July 19 that
losses associated with the home loans to people with poor credit
may be as much as $100 billion.


Read more at Bloomberg Bonds News

UPDATE 2-Fed's Poole: Subprime losses due to poor practices

(Reuters) - ST. LOUIS, July 20 - Poor underwriting and
investment decisions in subprime mortgage markets have led to
the losses that are now even-handedly punishing lenders and
investors, St. Louis Federal Reserve Bank President William
Poole said on Friday.




"I believe we should conclude that this year's markets
punished mostly bad actors and/or poor lending practices,"
Poole said in remarks prepared for delivery to a real estate
group.


Read more at Reuters.com Government Filings News

TREASURIES-Rally fades ahead of Bernanke encore

(Reuters) - Anxiety over troubled mortgage investments has kept bonds
afloat in recent sessions, briefly pushing benchmark yields
back below 5 percent.




Federal Reserve Chairman Ben Bernanke reinforced the rally
on Wednesday by zeroing in on subprime or high-risk home loans
in his congressional testimony. Downbeat housing data and
relatively tame inflation figures have also supported bonds.


Read more at Reuters.com Bonds News

UPDATE 3-Bernanke: US inflation main worry, housing a risk

(Reuters) - WASHINGTON, July 18 - Federal Reserve Chairman
Ben Bernanke told Congress on Wednesday housing market woes
could dampen an expected pickup in U.S. economic growth, but he
restated that the central bank's main worry is inflation.




"Overall, the U.S. economy appears likely to expand at a
moderate pace over the second half of 2007, with growth then
strengthening a bit in 2008 to a rate close to the economy's
underlying trend," he said in semiannual testimony to the House
of Representatives Financial Services Committee.


Read more at Reuters.com Bonds News

S.Africa bourse slips on global economy, rates woes

(Reuters) - Mining groups Anglo American and BHP Billiton led South African shares lower on Wednesday over jitters of economic slowdown in the U.S. and China, but gold shares soared on the metal's price.

Traders said the bourse was spooked into profit taking as U.S. stocks fell after Federal Reserve Chairman Ben Bernanke said the Fed expects the U.S. economy to expand one-quarter percentage point below its estimate six months ago.


Read more at Reuters Africa

Dollar Is Little Changed Versus Euro After Bernanke Says Growth to Pick Up

(Bloomberg) -- The dollar fell against the yen and
euro as the Federal Reserve lowered its forecasts for U.S.
economic growth for this year and next as home building is
weaker than anticipated.

The revisions came as Fed Chairman Ben S. Bernanke, in
semiannual testimony to the House Financial Services Committee,
predicted U.S. economic growth will pick up slightly next year
and inflation will gradually recede. He also said he expects a
slump in construction to continue to ``weigh'' on growth.


Read more at Bloomberg Currencies News

Dollar Gains Versus Euro After Consumer Prices, Housing Starts Increase

(Bloomberg) -- The dollar gained against the euro
after a government report showed U.S. consumer prices rose last
month by more than analysts forecast, while housing starts
increased.

Traders bought the dollar as the report fed speculation the
Federal Reserve will refrain from reducing its 5.25 percent
benchmark interest rate this year.


Read more at Bloomberg Currencies News

Gold up as euro hits record high, awaits Bernanke

(Reuters) - Gold gained on Wednesday as the dollar tumbled to a record low against the euro, but dealers are cautious ahead of a testimony by U.S. Federal Reserve Chairman Ben Bernanke.

Silver and platinum also rose. Tokyo gold futures rebounded to track a firm cash market, while the newly launched "mini" gold contracts saw a decline in turnover.


Read more at Reuters Africa

European Bonds Fall on Speculation Global Growth to Prompt Rising Rates

(Bloomberg) -- European bonds fell on speculation
global economic growth is fast enough to prompt the European
Central Bank to increase interest rates this year.

ECB council member Nicholas Garganas said higher rates are
``warranted.'' Ten-year bunds snapped two-days of gains after
U.S. reports showed factory output rose the most since February
and prices paid to producers excluding food and fuel climbed
more than forecast. Federal Reserve Chairman Ben S. Bernanke may
reiterate tomorrow that the bank is seeking to curb inflation.


Read more at Bloomberg Bonds News

TREASURIES-Bonds slip on PPI jump, stubborn Wall St

(Reuters) - NEW YORK, July 17 - U.S. Treasury debt prices
fell on Monday as producer prices rose more than forecast and
stronger earnings raised the possibility of a firmer open on
Wall Street .




Wholesale inflation outside food and energy, tracked by the
Federal Reserve, surged 0.3 percent in June. This brought
year-on-year price gains to 1.8 percent from 1.6 percent, and
should keep policy-makers on edge about lower interest rates.


Read more at Reuters.com Bonds News

New Zealand's Dollar Advances to 22-Year High on Outlook for Higher Rates

(Bloomberg) -- New Zealand's dollar rose to a 22-
year high amid expectations central bank Governor Alan Bollard
will raise interest rates from a record high next week, stoking
demand for the currency.

The chance of a rate increase rose to 71 percent from 44
percent yesterday, according to a Credit Suisse index after a
report showed inflation accelerated more than the central bank
had forecast. Bollard may raise the rate to 8.25 percent, 7.75
percentage points higher than Japan's benchmark and 3 points
more than the Federal Reserve target lending rate.


Read more at Bloomberg Currencies News