US Treasuries slump on upbeat economic data; FOMC meet eyed

The US Treasuries slumped on Monday following improved economic data released last week. Also, investors are eagerly awaiting the Fed policy decision, which is scheduled to take place on July 27 at 18:00 GMT.

In addition, markets also waiting for fresh 2-year note, 5-year note and 7-year note auctions on Monday, Tuesday and Thursday, respectively.

The yield on the benchmark 10-year Treasury note rose 1-1/2 basis points to 1.583 percent and the yield on short-term 2-year note also bounced 2-1/2 basis points to 0.731 percent by 12:30 GMT.

Last week, the US Jobless claims surprisingly declined to three-month low during the week ended July 16, which indicated an improving job market in the US. The US Initial jobless claims decreased -1k to 253k for the week ending 16 July, well below expectations for a 265k result, as compared to the unrevised 254k reading seen in the week prior. The 4-week average was reported at 257.8k, down from the unrevised 259.0k reading seen in the week prior.

Similarly, the preliminary Markit US manufacturing PMI reading increased to 52.9 for July, above market expectations for a 51.5 result, as compared to the 51.3 reading seen in June.

Lastly, markets now look ahead to a greater flow of data this week, highlighted by the July FOMC statement on Wednesday and the advance 2Q16 GDP release on Friday (market expectations are set for a +2.6 percent result).

Meanwhile, the S&P 500 Futures up 0.5 points to 2,168 by 12:30 GMT.