Scottish Independence Triggers Safe Haven Flows into Treasuries

Treasuries rose, with 10-year notes halting a slide that sent them to their biggest weekly loss since March, as investors sought a haven following a poll showing most voters in Scotland want independence.

Yields on the benchmark yields fell as JPMorgan Chase & Co. and Morgan Stanley cut their year-end forecasts. U.S. government securities are heading for their biggest annual advance since 2011, supported by demand due to unrest in Ukraine and the Middle East. The U.S. plans to sell $61 billion of notes and bonds during three days starting tomorrow.

“The idea that you have to get well above 2.42 percent to keep the market intact has faded,” said Jim Vogel, head of agency-debt research at FTN Financial in Memphis, Tennessee. “It’s an analysis of the price action after the selloff. We’ve readjusted.”

The U.S. 10-year yield fell three basis points, or 0.03 percentage point, to 2.42 percent at 9:06 a.m. New York time, according to Bloomberg Bond Trader prices. The 2.375 percent note due August 2024 rose 9/32, or $2.81 per $1,000 face amount, 99 17/32.

The U.S. is scheduled to sell $27 billion of three-year notes tomorrow, $21 billion of 10-year debt the following day and $13 billion of 30-year bonds on Sept. 11.

via Bloomberg

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