U.S. Treasuries gain ahead of 2-year note auction, July manufacturing PMI

The U.S. Treasuries gained Tuesday as investors wait to watch the country’s 2-year bond auction and the manufacturing PMI for the month of July, both scheduled to be released today by 17:00GMT and 13:45GMT respectively, besides, the coming up of services PMI for the similar period.

The yield on the benchmark 10-year Treasuries lost 1-1/2 basis points to 2.94 percent, the super-long 30-year bond yields slumped 2 basis points to 3.08 percent and the yield on the short-term 2-year traded tad lower at 2.62 percent by 11:10GMT.

On Thursday we will receive the advance goods trade report and durable good’s orders data for June, while Friday brings the first estimate of Q2 GDP. After a relatively modest increase in GDP at the start of the year of 2.0 percent q/q annualised, expectations are for a sharp acceleration. Indeed, a reading  of 4-1/2 percent q/q annualised, which would be consistent with the latest Atlanta Fed GDP now estimate, would not be a big surprise, although calculations of other regional Feds, New York and St Louis, suggest somewhat more moderate increases, Daiwa Capital Markets reported.

Lastly, the focus will be on the business sector -- preliminary July PMIs and the latest Richmond Fed Manufacturing survey are all expected to show a moderation from last month’s values. Nevertheless, both surveys will most likely remain consistent with a healthy momentum in the US economy at the start of Q3.

Meanwhile, the S&P 500 Futures remained 0.20 percent higher at 2,817.75 by 11:15GMT, while at 11:00GMT, the FxWirePro's Hourly Dollar Strength Index remained highly bearish at -176.61 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex