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Yield on US bonds is stable before auctions and Fed meeting

By Karen Brettell

NEW YORK, Apr 26 (Reuters) – The yield on U.S. Treasuries was little changed on Monday, before the Treasury Department sold $ 183 billion in short- and mid-maturity debt and the meeting of this week from the Federal Reserve.

* The Treasury will sell $ 60 billion in two-year notes and $ 61 billion in five-year paper on Monday and $ 62 billion in seven-year debt on Tuesday.

* The seven-year bond auction will be watched closely after the Treasury experienced weak demand for this tranche in February, prompting a broad sell-off in the market. These notes were also in subdued – albeit improved – demand in March.

* “I find it hard to believe that we will have a very weak third auction at seven years. In recent weeks there has been a clear demand for bonds, especially in the belly of the curve, so I think it will go well,” said Justin Lederer, strategist rate at Cantor Fitzgerald, New York.

* Benchmark 10-year debt has fallen from the high of more than a year hit last month, to 1,776%. In its last operations it was trading at 1.568%, with little change on the day.

* The return of the two-year notes was operating at 0.162%; that of the five-year papers, at 0.820%; and that of the seven-year debt, at 1.255%.

* The Fed is expected to confirm that it will leave rates near zero for several years to boost the economy when it concludes its two-day meeting on Wednesday.

(Edited in Spanish by Carlos Serrano)

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