cn TREASURIES-Long-dated Treasury prices slip on tapering fears
* Curve steepening resumes on tapering fears
* Weaker Philadelphia Fed business activity survey reduces losses
* 10-year TIPS auction offers minor supply pressure
* Drop in new jobless claims linked to holiday
* October Producer Price Index down 0.2 percent
NEW YORK, Nov 21 (Reuters) - U.S. Treasuries prices slipped and long-term interest rates rose on Thursday on worry about the Federal Reserve cutting back its large-scale bond purchases, even as soon as December.
After a voting member of the Fed's policy committee said on Wednesday a December "taper" was still on the table, worries about the impact of reduced Fed purchases were revived, even though many dealers' official position is that the Fed will not cut back its buying until March 2014.
"Overall sentiment has shifted to bearish on the long-end of the market because of a perceived QE taper in December," said Thomas di Galoma, co-head of fixed income rates at ED&F Man Capital in New York.
The difference between short- and long-term yields is now the steepest in more than two years, since late July-early August 2011 when a bid for safe-haven U.S. debt before that summer's standoff over the budget and debt ceiling began narrowing the gap between short- and long-term yields.
U.S. economic data released early in the session offered little ammunition for a December taper, however.
A drop in new U.S. jobless claims in the latest week and an October U.S. producer price index that deviated just slightly from forecasts had little perceptible market impact.
"The inflation picture is very subdued, and the risk of continued disinflation continues to be greater than risk of accelerating inflation," said Ward McCarthy, managing director and chief financial economist at Jefferies & Co. in New York.
In the market, a little bargain-hunting emerged overnight but a variety of data from Europe trimmed the gains.
"The severe curve steepening action yesterday was viewed as overdone in the near-term by some real money participants in Asia, attracting a bottom fishing bid through the early going in London and European trading," said John Canavan, fixed income analyst at Stone & McCarthy Research Associates.
The benchmark 10-year Treasury note briefly found support at 2.80 percent, the high yield from earlier this month before the curve steepening resumed.
Treasuries halved their losses, however, when the business activity index from the Philadelphia Fed came in weaker than expected since weak economic data make a December Fed tapering less likely.
The U.S. Senate Banking Committee approved Janet Yellen's nomination to become the first woman to lead the Federal Reserve, sending it to the full Senate for a final vote.
The Senate does not plan to vote until after a two-week Thanksgiving Day holiday break.
On the supply front, an auction of a reopened 10-year TIPS issue is due this afternoon. Traders are positioning for next week's auctions of two-, five- and seven-year Treasury notes.
All of this "should help keep today's bear reversal selloff and curve steepening fueled," Canavan said.
The benchmark 10-year Treasury note was down 4/32, its yield rising to 2.82 percent.
The 30-year bond was down 6/32 in price, its yield rising to 3.93 percent.