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Bond Prices Retreat as Investors Shift Focus to French Polls

April 20, 2017
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Treasury prices retreated, pulling back for the second consecutive session after an extended rally drove the yield on the benchmark note to multi-month lows.

U.S. government bond yields surged after an influx of strong U.S. economic data and a poll indicated that support for the far-right candidate in the French presidential election Marine Le Pen has weakened.

The yield on the 10-year note ended at 2.240 percent, advancing 3.7 bps, up from the 2.202 percent on Wednesday, and its lowest level since November 10. Yield on the two-year note advanced 2.4 bps to 1.97 percent, while the yield on the 30-year bond, advancing by 2.8 bps to 2.891 percent.

Demand for safe-haven bonds weakened as increasing geopolitical tensions associated to the French presidential election allayed after a poll showed support for anti-EU and anti-euro currency candidate Le Pen has declined as centrist candidate Emmanuel Macron held on to his advantage. The poll comes a few days before the first round of election on Sunday.

In recent days, appetite for safe-haven bonds was stoked by worries that extremist candidates such as Jean-Luc Melenchon and Le Pen would be left to have a face-off in the second round of voting.
The material has been provided by InstaForex Company – www.instaforex.com

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