Prices for U.S. Treasurys fell on Tuesday, with stronger-than-expected U.S. service sector data suggesting the world's biggest economy may have weathered last month's partial government shutdown better than feared.
The Institute of Supply Management non-manufacturing survey index rose to 55.4 in October from 54.4 in September. A reading above 50 in the index indicates an expansion in the U.S. service sector. Economists polled by Reuters expected a reading of 54.0
Prices for U.S. benchmark 10-year Treasury notes dipped 16/32 in price on Tuesday to yield 2.666 percent, compared to a yield of 2.6035 percent late on Monday.
The Treasurys market is now turning on one central question: When will the U.S. Federal Reserve slow its $85 billion per month bond-buying program?
Despite expectations for a September taper, the central bank has instead held firm to its course, although it did take on a more hawkish tinge after its most recent policy meeting last month.