TREASURIES-Prices rise slightly on tepid economic data
* Orders for durable goods tepid in August
* New home sales rose in August, still near lowest levels of 2013
* Treasury to sell $35 billion in five-year notes
NEW YORK, Sept 25 (Reuters) - U.S. Treasuries prices edged up on Wednesday for the fourth session in a row as data on new home sales and on orders for long-lasting manufactured goods last month supported the outlook for accommodative monetary policy from the Federal Reserve.
The tepid report on U.S. sales of long-lasting manufactured goods in August had little market impact, however, as did lackluster news on new home sales in August. Home sales rose last month, but remained near the lowest levels of the year.
Benchmark 10-year notes rose 2/32 in price, their yields easing to 2.643 percent from 2.66 percent late on Tuesday.
The modest gains occurred ahead of the Treasury's $35 billion five-year note auction at 1 p.m. (1700 GMT).
"Treasuries are anticipating 5-year supply today and the possibility that the new 5-year notes could be re-opened into an older seven-year issue," said Tom di Galoma, head of fixed-income rates sales at ED&F Man Capital in New York.
Economic data supported the outlook for accommodative monetary policy. Orders for long-lasting U.S. manufactured goods rose just 0.1 percent August after plummeting 8.1 percent in July. Orders for non-defense capital goods excluding aircraft, seen as a proxy for business spending, rose 1.3 percent after falling 1.4 percent in July and slipping 1.0 percent in June.
"Overall the report was soft ... but the market did pretty much nothing on this data," said David Ader, Treasury strategist at CRT Capital Group.
Ader said a heavy calendar of corporate issuance could also be "keeping a lid" on the bid for Treasuries.
Hedging before some major corporate issuance could account for small price moves in the Treasury market as the hedges are placed ahead of the deals and lifted afterwards.
"Given the relatively thin market and light volume conditions, the potential is for a further pullback as portfolio types switch out of seasoned holdings to make room for these new deals," said Kenneth Logan, rates analyst at IFR, a Thomson Reuters unit.
Treasuries prices have risen and yields have fallen since the Federal Reserve decided to put off unwinding any of its monetary accommodation until it had more confidence in the sustainability of the still-subdued economic recovery.
At its policy meeting last week, the Fed decided not to trim its large-scale asset purchases, citing strains in the economy from tight fiscal policy and higher mortgage rates. Fewer asset purchases would put downward pressure on bond prices and upward pressure on yields.
As part of its ongoing efforts to foster economic activity and lower unemployment, the New York Fed is expected to buy Treasury coupons on Wednesday with maturities ranging from November 15, 2020 through August 15, 2023.