Treasury bills take Gain as Noda, counter Crescenzi S & P warning

April 19, 2011, 1: 43 pm EDT by Wes Goodman

April 19 (Bloomberg) — treasuries kept gains from the previous two days as the holders of the Japan to the United States said that the market will still attract investors even after Standard & Poor threatened to lower the rating of the nation.

U.S. debt is "interesting", the Minister of finance Yoshihiko Noda said at a press conference in Tokyo today. Economic and fiscal policy Minister Kaoru Yosano reiterated the comment. Pacific Investment Management Co., which manages bond fund the largest in the world, said that Treasury market will always be a place for other nations to invest. "Where they will put their reserve assets? "Tony Crescenzi, a strategist on market and Portfolio Manager for Pimco in Newport Beach, California, said in an interview on Bloomberg Television"first Up"with Susan Li"Treasury market remains the deepest market. "", more liquid in the world".Yields 10 years was little changed at 3.38% starting from 6 h 40 London, according to the Bloomberg Bond Trader price. The note of 3.625%, due in February 2021 traded to 102 2/32.Yields are down 3.80% a year and less than the average of 5.21% over the past two decades, even with the United States planned to publish a further deficit of 1000 billion dollars for the third consecutive year. Yields will remain less than 4 per cent by year-end, according to the median of the 73 forecasts economists in a survey of Bloomberg News.S & P has yesterday advised us Government that it risks losing its AAA rank unless officials agree on a plan in 2013 to reduce budget deficits and the national debt.Still have DemandChina, Russia, Brazil, South Korea and other nations will always demand for Treasury, said Crescenzi, although Pimco joins criticism of U.S. spending. Bill Gross, who manages the funds of the record-size 236 billion Pimco Total return, set a bet against the Government of the United States and the related debt in March. U.S. spending can result in inflation and the devaluation of the currency, it said in its outlook April posted on the Web of Pimco.Avoirs of reserve in the world soared to a record of the month $ 9.65 billion, according to Bloomberg data. China is of America's largest creditor, holding the 9.13 $ 1.15 trillion trillion dollars of rated debt. The Japan is second with 890.3 billion. "We continue to see the U.S. debt as an attractive investment," said the Treasury Japon.Bons Noda would be "very good quality titles" even if the note is cut, Yosano said at a separate press conference in the Japanese capital. " "To go to the Rise of Yields will even ride in 2011, said Tomohisa Fujiki, a strategist of rate of interest to BNP Paribas Securities Ltd., Tokyo Japan. U.S. of BNP unit is one of 20 primary dealers that trade directly with the Federal Reserve. "Towards the end of this year, we think that yields will increase,"Fujiki said." "The US economy is in the process of recovery, even if the pace is slow," he said.Ten years rate will be increased to 4.25% before December 31, said Fujiki.Banque fed of St - Louis President James Bullard yesterday said he is optimistic about the US economy this year. Fed Dallas President Richard Fisher said in separate comments, that the recovery appears to be "independent".A report by the Government today will show in construction increased by 8.6% in March from the month before, after a decline of 23% in February, a survey of Bloomberg News of economists prior to the report of the Department of trade difference of RateThe of break-even yields the notes of 10 years and of the Council of Treasury Inflation protected securities, a gauge of expectations of trader to the consumer during the life of the debt price, expanded to 2.61 percentage points of 2.08 six months percentage points. The average of 10 years is 2.10 percentage points.Bonds passed yesterday as speculation that the Greece will be unable to avoid a default and decline in stocks boosted demand for safe haven assets. "" Geopolitical concerns have not disappeared, and we are witnessing in Treasury bills, the flow of security ", said Russ Certo, a Director General and rates of Exchange at Gleacher & Co. in New York .credit - default swaps covering the Treasury bills climbed to a maximum of 11 weeks of 49.5 basis points yesterday, according to the CMA data provider. 56 Markets followed by Bloomberg, only Germany, Netherlands, Denmark, Switzerland, Finland, Sweden and Norway have swap costs.Traders use swaps credit - default to wonder about the quality of the credit. A price drop signals perceptions improved creditworthiness, while the increase suggests otherwise. Contracts to pay the buyer if a borrower does not meet its debt agreements.

-With the help of Cordell Eddings and John Detrixhe in New York. Editors: Nicholas Reynolds, Rocky Swift

To contact the reporter on this story: Wes Goodman at Singapore at wgoodman@bloomberg.net.

To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net.

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