US TREASURY OUTLOOK-Inflation, housing data may boost bonds

(Reuters) - Woes in the subprime mortgage market to borrowers with poor
credit are making investors wary of riskier assets and have
stoked demand for safe haven Treasuries. Treasury prices may
also gain from any hints the Fed could cut interest rates in
the face of a slipping housing market. Yet inflation pressures
are likely to deter the central bank from cutting interest
rates for many months, according to market participants.




The Producer Price Index is due on Tuesday at 8:30 a.m.
. The overall PPI rose 0.2 percent in June, after a
0.9 percent rise last month, according to economists' median
forecast. Core producer prices, which exclude food and energy,
are also forecast to rise 0.2 percent.


Read more at Reuters.com Bonds News

German Producer-Price Inflation Slows to Two-Year Low as Energy Costs Drop

(Bloomberg) -- German producer-price inflation, an early indicator of price pressure in an economy, slowed to the lowest rate in more than two years in March after energy costs dropped.

The price of goods from plastics to newsprint increased 2.5 percent from a year earlier, after rising 2.8 percent in February, the Federal Statistics Office in Wiesbaden said today. That's the lowest since September 2004. Economists expected a rate of 2.7 percent, the median of 28 forecasts in a Bloomberg News survey shows. Prices increased 0.3 percent from a month earlier.


Read more at Bloomberg Currencies News