Treasuries rise fourth day before talks start on fiscal cliff

‘Different Views’

IMF Managing Director Christine Lagarde yesterday took issue with a decision by euro-area chiefs to postpone the goal of getting Greece’s debt down to a “sustainable” level of 120 percent of gross domestic product by two years, until 2022.

“Debt sustainability of Greece has to be measured in 2020,” Lagarde said. “We clearly have different views. What matters at the end of the day is the sustainability of the Greek debt.”

Economists say a report this week will show consumer-price inflation stayed higher than Treasury yields.

U.S. consumer prices excluding food and energy gained 2 percent in October from a year ago, according to the median forecast of economists surveyed by Bloomberg News before the data is released Nov. 15. A similar gauge for producer prices climbed 2.4 percent, a separate Bloomberg survey showed before the report tomorrow.

The so-called real yield on U.S. 10-year notes, or the difference between their yield and the current rate of inflation, was minus 42 basis points.

“Treasuries’ real yields are negative and that helps sap demand for the securities,” said Makoto Suzuki, a senior bond strategist in Tokyo at Okasan Securities Co. “It raises the question whether Treasury yields can go lower from here.”

Bloomberg News

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