TREASURIES-Longer-dated yields higher as investors watch for supply details

 (Updates market activity, adds analyst comment)
    By Ross Kerber
    June 1 (Reuters) - Investors pushed longer-dated U.S.
Treasury yields higher on Monday as they tried to forecast how
the government would finance massive efforts to stimulate the
    The benchmark 10-year yield was up 2.8 basis
points at 0.6721% in afternoon trading.
    Wall Street's major indexes rose as economic data bolstered
views of a quick post-pandemic recovery.
    For Treasuries, analysts said the trading showed investors 
shrugging off widespread civil unrest in U.S. cities over the
weekend and instead focusing on how many 20- and 30-year bonds
federal officials may sell. 
    "The market is trying to figure out how the deficits will be
funded," said Jim Barnes, director of fixed income at Bryn Mawr
    Generally, a greater supply will lead to lower prices and
higher yields. At the same time a reluctance by the Federal
Reserve to raise interest rates is keeping yields on
shorter-term treasuries lower.
    "The Fed's outlook is known, they haven't been shy about
it," said Guy LeBas, chief fixed-income strategist at Janney
Montgomery Scott. 
    The Fed also has been reducing its bond purchases, which it
ramped up to historic highs in March.
    A closely watched part of the U.S. Treasury yield curve
measuring the gap between yields on two- and 10-year Treasury
notes, which is seen as an indicator of economic
expectations, was at 51 basis points, about 2 basis points
higher than Friday's close.
    The two-year U.S. Treasury yield, which typically
moves in step with interest rate expectations, was up less than
a basis point at 0.1603%.
  June 1 Monday 2:06PM New York / 1806 GMT
 US T BONDS SEP0               177-16/32    -0-28/32  
 10YR TNotes SEP0              138-240/256  -0-32/25  
                               Price        Current   Net
                                            Yield %   Change
 Three-month bills             0.1375       0.1398    -0.002
 Six-month bills               0.1625       0.1649    -0.002
 Two-year note                 99-238/256   0.1603    0.004
 Three-year note               99-200/256   0.1994    0.010
 Five-year note                99-182/256   0.3084    0.008
 Seven-year note               99-240/256   0.5091    0.016
 10-year note                  99-140/256   0.6721    0.028
 30-year bond                  94-196/256   1.4666    0.063
   DOLLAR SWAP SPREADS                                
                               Last (bps)   Net       
 U.S. 2-year dollar swap         8.75        -0.50    
 U.S. 3-year dollar swap         6.00        -1.00    
 U.S. 5-year dollar swap         5.25         0.00    
 U.S. 10-year dollar swap       -1.00        -0.50    
 U.S. 30-year dollar swap      -48.50        -1.00    
 (Reporting by Ross Kerber in Boston; Editing by Leslie Adler)

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