TREASURIES-Prices slip after new jobless claims fall
* New U.S. jobless claims fall to near six-year low of 305,000
* Four-week average of new claims falls 7,000 to 308,000
* Treasury to sell $29 billion seven-year notes at 1 p.m. EDT (1700 GMT
NEW YORK, Sept 26 (Reuters) - U.S. Treasuries prices slipped on Thursday, interrupting a four-session winning streak, on news of fewer new U.S. jobless claims in the latest week.
The number of Americans filing new claims for jobless benefits fell last week to a seasonally adjusted 305,000, a near six-year low, the Labor Department said on Thursday. The four-week average of new claims, which evens out weekly volatility, fell 7,000 to 308,000, the lowest level since June 2007.
The report was "obviously constructive for the labor market outlook as we head into next week's non-farm payrolls report," said Ian Lyngen, Treasury strategist at CRT Capital Group in Stamford, Connecticut.
The possibility that U.S. payroll growth might turn out to be stronger than forecast so far weighed on U.S. Treasuries.
"This level of claims is consistent with a +200,000 NFP print, compared with the +175,000 consensus," Lyngen said.
Benchmark 10-year Treasury notes, down 2/32 in price before the report was issued, were down 4/32 afterwards, yielding 2.65 percent.
Thirty-year Treasury bonds, down 4/32 in price before the jobless claims report came out, were down 10/32 afterwards, yielding 3.69 percent.
The losses also occurred as traders positioned for the Treasury's auction of $29 billion in seven-year notes - the third and final coupon sale of the week - at 1 p.m. EDT (1700 GMT). The Treasury sold two-year notes on Tuesday and five-year notes on Wednesday.
The 305,000 new jobless claims was "a very, very good number for the economy," said Chris Rupkey, managing director and chief financial economist at Bank of Tokyo-Mitsubishi UFJ.
"The sky is not falling, things are picking up. A very good monthly jobs report is out there somewhere on the horizon. The Fed may have to wind down and exit these policies quicker than they think," he said.
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.
Fed Bank of Minneapolis President Narayana Kocherlakota is due to speak about monetary policy strategy at 1215 EDT/1615 GMT.