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Treasuries Advance Amid Speculation ECB to Purchase Securities

May 14 (Bloomberg) -- Treasuries rose, pushing 10-year yields to the lowest level since November, amid speculation that monetary stimulus by the European Central Bank will make U.S. yields more attractive.

U.S. government securities advanced for a second day along with their euro-area counterparts after Germany’s Die Zeit reported a European Central Bank policy maker as saying the ECB was preparing a range of measures to support the economy, including quantitative easing, or bond purchases. A U.S. government report showed producer-price inflation rose more than forecast before the U.S. announces tomorrow the amount it will sell next week in 10-year inflation-indexed securities.

“It’s the anticipation of QE in Europe that’s driving the bus here,” said Thomas Roth, senior Treasury trader in New York at Mitsubishi UFJ Securities USA Inc. “There are other signs that the market is looking at, other than the data.”

The U.S 10-year yield fell three basis points, or 0.03 percentage point, to 2.58 percent at 8:31 a.m. in New York, according to Bloomberg Bond Trader prices. The yield declined earlier to 2.57 percent, the lowest level since Nov. 1.

Treasuries returned 2.7 percent this year through yesterday, versus 4.9 percent for U.S. investment-grade corporate debt, based on Bloomberg indexes. The Standard & Poor’s 500 Index of shares gained 3.4 percent including reinvested dividends, according to data compiled by Bloomberg.

Related News and Information: Bloomberg World Bond Indexes: WBIX Sovereign Debt Movers: WBMV Bond yield forecasts: BYFC Top bond market news: TOP BON World bond markets: WBX Credit market watch: CMW Sovereign debt monitor: SOVR

To contact the reporters on this story: Susanne Walker in New York at swalker33@bloomberg.net; Anchalee Worrachate in London at aworrachate@bloomberg.net To contact the editors responsible for this story: Dave Liedtka at dliedtka@bloomberg.net Greg Storey

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