U.S. Treasuries were down slightly on Monday, ahead of a series of Federal Reserve speakers this session and before this week's inflation data, which could shed insight on the likelihood of a June rate hike.
Also overshadowing the market was the prospect of a higher opening on Wall Street, according to Dow Jones futures. On Friday, U.S. Treasury debt prices rose as the stock market's retreat encouraged investors to store their cash elsewhere.
In the wake of (Fed chief Ben) Bernanke's very much market moving remarks at the start of last week, I think the market will be looking to (Fed Bank of Cleveland President Sandra) Pianalto for extra confirmation that a June rate hike is on the cards, said John Davies, fixed-income strategist at West LB.
At 0918 GMT, 10-year U.S. Treasury yields were up slightly at 4.987 percent. Two-year U.S. Treasury yields were up 1.3 basis points at 5.018 percent.
A number of Fed officials speak later this session including the Fed chairman himself at 2330 GMT but Pianalto is the only one who is scheduled to speak on the economy and monetary policy, at 1315 GMT.
Other speakers include Fed Bank of Dallas President Richard Fisher at 1430 GMT, Fed Board Governor Mark Olson at 1615 GMT and Fed Board Governor Susan Schmidt Bies at 1900 GMT.
Fed officials including Bernanke rattled markets last week by consistently banging the drum about inflation concerns.
Investors are increasingly convinced the Fed will again raise rates from 5 percent in late June to contain inflation, but will look to U.S. producer and consumer price data this week for further confirmation that inflation does indeed pose a threat.
Officials' comments about inflation concerns have been just too consistent to ignore and the only real potential for a change from this view comes from this week's CPI data, said Charles Diebel, head of European rates strategy at Nomura International in a research note.
If the numbers are exceptional benign then it may be enough to tilt the Fed into a pause, but based on consensus forecasts this looks unlikely.
Economists polled by Reuters forecast consumer prices, excluding volatile food and energy, to have risen 0.2 percent on the month.
U.S. Federal budget figures for May are also due at 1800 GMT.