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US Treasurys gain amid US election uncertainty

U.S. government debt prices were slightly higher on Monday as investors digested the latest news surrounding the U.S. election and prepared for more central bank news.

The yield on the benchmark 10-year Treasury note sat lower around 1.8239 percent, while the yield on the 30-year Treasury bond was also down at 2.5776 percent. Bond yields move inversely to prices.

The yield on the two-year Treasury note was lower near 0.8488 percent.


Symbol
Yield
 
Change
%Change
US 3-MO
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US 1-YR
---
US 2-YR
---
US 5-YR
---
US 10-YR
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US 30-YR
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While bond markets are set to focus on key data, auctions and news out of leading central banks, all of this could be overshadowed this week by news emerging out of the U.S. election.

On Friday, the FBI announced that it was reviewing new evidence in connection with its investigation of Hillary Clinton's email server. The news shook markets and sent U.S. stocks to close mostly lower, last Friday.

Aside from the upcoming U.S. election, the Federal Open Market Committee is set to meet Tuesday for the start of its two-day meeting, to discuss the current state of the U.S. economy, and contemplate when would be the correct time to raise interest rates.

Elsewhere, the Bank of Japan has kicked off its two-day monetary policy meeting on Monday. And in Europe, focus is on the Bank of England and its Governor Mark Carney, after the Times newspaper reported that Carney was unlikely to take up the option of a three-year extension to his term at the U.K. central bank.

When it comes to data, aside from the Dallas Fed survey, U.S. consumer spending rose more than expected in September, gaining 0.5 percent. The Chicago PMI fell to 50.6 in October, below projections for about 54, according to economists polled by Thomson Reuters.

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Meanwhile in oil, prices were under slight pressure on Monday, with U.S. crude settling down 3.78 percent at $46.86 a barrel.

On the auctions front, the U.S. Treasury is set to auction $42 billion in 13-week bills and $36 billion in 26-week bills. It is also expected to announce the size of a four-week bills auction, set to take place on Tuesday.

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