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TREASURIES-U.S. bond yields fall as CPI, retail sales data miss forecasts

(Updates to U.S. mid-morning, adds quote) NEW YORK, May 12 (Reuters) - U.S. Treasury yields fell on Friday as weaker-than-expected data on domestic consumer prices and retail sales in April scaled back expectations of a strong U.S. economic rebound in the second quarter and revived appetite for bonds. The benchmark 10-year Treasury yield fell 6 basis points to 2.338 percent. It reached 2.423 percent, a near six-week peak, on Thursday in reaction a surprisingly strong report in U.S. producer prices in April. "It's a pretty clear data response, but it's not going to take us out of the trading range that has been recently carved out," said Blake Gwinn, U.S. rates strategist at NatWest Markets in Stamford, Connecticut. The 30-year bond yield decreased 4 basis points to 2.995 percent. It climbed to 3.059 percent on Thursday, which was the highest since March 21, Reuters data showed. U.S. yields rose broadly earlier this week on heavy government and corporate bond supply, along with centrist Emmanuel Macron's presidential win in France last Sunday, which spurred investors to reduce their safe-haven bond holdings. Friday's demand for Treasuries also stemmed from bargain-minded investors. They emerged after the completion of the $62 billion May refunding supply, in which investors gave a cool reception to new issues of three-year, 10-year and 30-year government debt, analysts and traders said. May 12 Friday 10:57AM New York / 1457 GMT Price

US T BONDS JUN7 151-15/32 0-27/32 10YR TNotes JUN7 125-124/256 0-144/25

6

Price Current Net Yield % Change

(bps)

Three-month bills 0.8625 0.8763 -0.008 Six-month bills 1.01 1.0292 -0.008 Two-year note 99-232/256 1.2985 -0.049 Three-year note 100-4/256 1.4947 -0.061 Five-year note 100-20/256 1.8584 -0.068 Seven-year note 99-28/256 2.1384 -0.071 10-year note 100-96/256 2.3327 -0.067 30-year bond 100-36/256 2.9929 -0.046

DOLLAR SWAP SPREADS

Last (bps) Net

Change (bps)

U.S. 2-year dollar swap 24.50 -0.50

spread

U.S. 3-year dollar swap 20.25 0.25

spread

U.S. 5-year dollar swap 6.50 0.25

spread

U.S. 10-year dollar swap -7.75 0.50

spread

U.S. 30-year dollar swap -46.50 -0.25

spread

(Reporting by Richard Leong; Editing by Dan Grebler)