* Growth, Greece worries stoke safety bids for bonds
* U.S. to sell $32 bln in 3-year note supply
* Fed buys $1.89 billion in long-dated debt
* Long bond yield dips below 200-day moving average
(Updates on 30-year bonds)By Richard Leong
NEW YORK, Oct 9 (Reuters) - U.S. Treasuries prices rose onTuesday in advance of a three-year debt sale as safe-haven bidsfor bonds emerged on anxiety about weak global growth andGreece's ability to meet the terms of a bailout.
Worries about anemic economic and profit growth ledinvestors to pare their holdings in stocks and other riskyassets and to raise their positions in less-risky Treasuries.
The International Monetary Fund, one of Greece's mainlenders, said in a report o n T uesday that Athens would miss thefive-year debt reduction target that is one of the conditionsfor the country's 130 billion euro bailout.
The group also warned that the United States faces meagergrowth of about 2.0 percent this year and in 2013 and predicteda 0.4 percent contraction in the euro zone's economy this year.It also downgraded its outlook on China, the world's second-largest economy.
The IMF outlook "was adding to the downbeat sentiment. Itwas a confirmation of slow growth globally," said GennadiyGoldberg, an interest rate strategist with TD Securities in NewYork. "That's why we are setting back into this trading range."
The concerns about Greece and global growth overshadowed agovernment report on Friday that showed the U.S. jobless ratefell in September to 7.8 percent, its lowest since January 2009.This and other surprisingly upbeat aspects of the Septemberpayroll data led to a sell-off in Treasuries and pushedbenchmark yields to their highest levels in about two weeks.<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Graphic:Euro debt crisis
The U.S. bond market was closed on Monday due to theColumbus Day holiday.
German Chancellor Angela Merkel said during a visit toGreece on Tuesday that Athens is making progress with fiscalreforms. Her visit coincided with protests against steepspending cuts in various government programs.
Safe-haven appetite for Treasuries was mitigated by someselling by bond dealers in anticipation of this week's $66billion in coupon supply.
The Treasury Department will sell $32 billion in three-yearnotes at 1 p.m. (1700 GMT). It will sell $21 billion in 10-yeardebt on Wednesday and $13 billion in 30-year bonds on Thursday.
Traders expected the upcoming three-year note
to sell at a yield of 0.347 percent, compared with 0.337 percentat last month's auction.
Also on the supply front, the Federal Reserve resumed itsOperation Twist, which involves the selling of shorter-datedTreasuries and purchases of longer-dated issues in a bid to holddown long-term borrowing costs and to help the economy. Itbought $1.889 billion in Treasuries due in Feb 2036 to Aug 2042.
Fed Vice Chairwoman Janet Yellen was scheduled to speak at8:30 p.m. (0030 GMT) about sovereign risk and financial marketsat an event sponsored by the IMF and the Japanese ministry offinance.
"The market is struggling with a lot of moving parts," saidRobert Tipp, chief investment strategist with Prudential FixedIncome in Newark, New Jersey. "At the end of the day, we'll bein a pretty tight trading range."
On the open market, benchmark 10-year notes
up 11/32 in price to yield 1.703 percent, down 4 basis pointsfrom late on Fr iday when it touched 1.748 percent, the highestsince Sept 24.
rose 31/32 in price to yield2.921 percent, down almost 5 basis points from Friday's close.The 30-year yield slipped below its 200-day moving average of2.939 percent, according to Reuters data.
Wall Street stocks fell, with the Standard & Poor's 500index
0.8 percent lower. Traders will focus on theearnings of Dow component Alcoa
after the market close.Analysts expect the aluminum producer likely broke even in thethird quarter.
(Editing by Dan Grebler)
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((-------MARKET SNAPSHOT AT 11:58 a.m. EDT (1558 GMT)-------Dec T-Bond148-11/32 (+03/32)Dec 10-Year note133-07/32 (-02/32)Change vs CurrentNyk yieldThree-month bills0.095 (-0.01) 0.096Six-month bills0.14 (+0.00) 0.142Two-year note99-31/32 (+) 0.262Five-year note99-28/32 (+04/32) 0.65210-year note99-11/32 (+10/32) 1.69830-year bond96-19/32 (+30/32) 2.922DOLLAR SWAP SPREADSLAST ChangeU.S. 2-year dollar swap spread 12.50 (-1.25)U.S. 3-year dollar swap spread 12.00 (-1.25)U.S. 5-year dollar swap spread 13.50 (-0.50)U.S. 10-year dollar swap spread 5.50 (-0.75)
U.S. 30-year dollar swap spread -22.25 (-1.00)))
Keywords: MARKETS USA BONDS/