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Week ended 22nd July, 2011 – Treasuries & Bonds this week .

After several hours of talk, Euro leaders announced rescue funds for Greece and also fund to buy debt across Euro-nations. This fund can also aid troubled banks and also to solve some problems of Spain and Italy. Greece gets lower interest rates and also longer repayment time for it’s loan. Bond yield across the Euro-area, especially in troubled countries fell this week. Spain paid higher yields but there were solid demand for those bonds which they issued this week. Sometime ago there came a sound about common Euro-bond, this week France’s positions showed that it is still too far.


Yields
22th-July-2011
7/15/2011-7/22/2011
7/8/2011-7/15/2011




2-Year Treasury
0.392
10.11%
-9.18%
5-Year Treasury
1.508
4.57%
-8.21%
10-Year Treasury
2.964
2.03%
-3.87%
30-Year Treasury
4.258
0.28%
-0.86%

Problems in other side of the Atlantic are not ending like Euro-area. Proposals are coming but not any common base. Politicians are making things very hard, as talk about using presidential veto came this week.


Coming week


Since some developments came in Euro-area, so some stability may come in financial world. 
But we cannot forget that problems are still there in US, so any bad news from that area will effect the debt market in coming days. 2.872 was acting as a good support for 10-Year Treasury Yield and though in the later period it bounces from that but it is getting resistance at around 3.00 level. If in coming days it able to break this resistance then it will test level around 3.20.
0.40 is acting as immediate resistance for 2-Year Treasury Yield. If situation improves then it may re-test resistance of 0.44 and then 0.48. In the downside 0.332 is still a support for it.
5-Year Treasury Yield  couldn’t able to break 1.40 support level, it bounced before that and it is getting immediate resistance at 1.55 level as I mentioned in last day. 1.40 is still a support for it and in the upside if it breaks 1.55 then it will test 1.65 resistance level.
30-Year Treasury Yield got resistance at 4.30 and it may take time to break 4.40 level. In the downside 4.10 is still good support for it.

Treasury will sell $170 billion bills and notes in next week.


Since matters of Greece and overall Euro-area have showed some green light, so focus now will be shifting on US. This week S&P said that they may cut US sovereign rating to AA+ ,  even if congress raises debt limit. Sometime I thought that rating agencies are talking about cutting AAA ratings of US for this debt ceiling, don’t they think that huge amount of debt which lies on them are enough to cut this AAA rating !




NOTE :  Please see the disclaimer below this blog .



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