Treasuries Fall as Employment Gains Cast Doubt on Fed’s Low-Rate Policy

Treasuries declined after the U.S. jobless rate unexpectedly fell to the lease in three years, raising skepticism about Federal Reserve Chairman Ben S. Bernanke’s extended low-rate policy and limiting demand for the safety of U.S. debt.

Yields on 30-year bonds reached the highest level in more than a week as the economy added more jobs in January than forecast, easing concern Europe’s debt crisis is stalling the U.S. recovery.

The difference between yields on 10-year notes and the inflation-indexed securities of the same maturity touched the widest since October. The U.S. will sell $72 billion in notes and bonds next week.

Pakistan to start new options in securities

The federal government intends to start three new options ie call, switch and swap in its securities.

Sources of banking industry said that by starting these three new options in both federal as well as provincial securities, institutional investors, both local and foreign, will be lured to make investment.

India by changing its Security Act of forties, 4 years ago had created depth and widened investment scope in its union securities.

The initiative of Indian government also led to investment in union securities by overseas Indians.