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TREASURIES-Bonds little changed before Fed minutes, jobs data

(Adds details, quote, updated prices)

By Karen Brettell

NEW YORK, Oct 3 (Reuters) - U.S. Treasuries ended little changed on Wednesday as investors waited on the release of minutes from the Federal Reserve's September policy meeting on Thursday, and on a highly anticipated jobs report on Friday for further direction about the strength of the economic recovery.

Bond prices fell earlier on Wednesday after data from payrolls processor ADP's showed that U.S. private-sector employers added 162,000 jobs in September, topping economists' forecasts.

But they later drifted back to little changed as investors turned their attention to Thursday's Fed minutes and Friday's more closely watched report.

"I think we're in a wait and see mode, we are awaiting (the FOMC) minutes and then all eyes will be focused on the payroll data," said Sean Simko, senior portfolio manager at SEI Investments in Oaks, Pennsylvania.

Thursday's Fed meeting minutes from the September 12-13 meeting will be scoured for signs over how open the U.S. central bank will be to further asset purchases, after it announced last month that its third quantitative easing program will focus on mortgage-backed debt.

Some investors expect the Fed may also add new Treasuries purchases after Operation Twist expires at the end of the year.

"There is more chatter on that," said Simko. That said, "I think the Fed may want to remain (on the) sidelines and wait and see until the end to Operation Twist to see where everything stands; where the economy stands, what is happening with the fiscal cliff and the markets in general."

Payroll data on Friday is expected to show that employers added 113,000 jobs in September, while the unemployment rate is expected to have ticked up in the month to 8.2 percent, from 8.1 percent in August, according to a Reuters poll of economists.

Recent divergences between this figure and the ADP jobs number makes it less likely that traders will have increased these expectations based on Wednesday's data.

"The market reaction was muted," said Eric Stein, vice president and portfolio manager at Eaton Vance Investment Managers in Boston. "ADP is a pretty good indicator for helping to analyze the labor market, but it has not done a very good job of predicting the subsequent (U.S. Labor Department) payrolls print so many short-term traders give it less weight."

Long-bonds were among the weakest performers on Wednesday, weighed down in part by hedging of corporate debt sales.

"There's rate-locking and traders are adding to steepening exposure," said Tom di Galoma, managing director at Navigate Advisors LLC in Stamford, Connecticut. "They're selling the long end to buy the front end."

High grade corporate debt issuance slowed on Wednesday, after around $18 billion was sold on Monday and Tuesday, said IFR, a Thomson Reuters service.

U.S. benchmark 10-year Treasury notes

were last unchanged in price to yield 1.63 percent. Thirty-year bonds fell 5/32 in price to yield 2.83 percent, up from 2.82 percent late on Tuesday.

(Additional reporting by Ellen Freilich; Editing by Theodore d'Afflisio)

((karen.brettell@thomsonreuters.com)(+1-646-223-6274, Reuters Messaging: karen.brettell.thomsonreuters.com@thomsonreuters.net))

((------------------- MARKET SNAPSHOT AT 1457 EDT (1857 GMT) -------------------------

Change vs Current Nyk yield Three-month bills 0.0875 (+0.00) 0.089 Six-month bills 0.1325 (-0.01) 0.133 Two-year note 100-01/32 (+) 0.234 Five-year note 100-03/32 (+02/32) 0.604 10-year note 100-01/32 (-01/32) 1.623 30-year bond

98-16/32 (-06/32) 2.825

DOLLAR SWAP SPREADS LAST Change U.S. 2-year dollar swap spread 13.00 (-1.00) U.S. 3-year dollar swap spread 12.25 (-1.00) U.S. 5-year dollar swap spread 13.25 (-0.75) U.S. 10-year dollar swap spread 6.50 (-1.00)

U.S. 30-year dollar swap spread -21.25 (-0.50)))

Keywords: MARKETS USA BONDS/