Safe-haven bonds in the U.S. and Germany have been given a boost from growing concerns that Greece is moving closer to a "disorderly" exit from the euro zone.
But amid the latest positive signs emerging from Greece, Treasury prices gave up some of their recent gains. The yield on benchmark 10-year Treasury notes rose to 2.36 percent from about 2.33 percent in late New York trade on Monday. The 30-year yield was at 3.11 percent on Tuesday from 3.10 percent.
Greece has shut banks, imposed capital controls and called a referendum on Sunday on austerity cuts in the aid program proposed by creditors.
In addition to Greek jitters, safe-haven bonds could draws support from concerns about a possible debt default in Puerto Rico, which analysts say could have ramifications for emerging markets.
Puerto Rico Gov. Alejandro Garcia Padilla late on Monday said the island,whose economy is closely tied to the U.S., needs a restructuring plan for its $72 billion in debt.
U.S. economic data due this session include the June Chicago purchasing managers` index and June consumer confidence index. The datahighlight of the week is the U.S. non-farm payrolls report, which will bepublished on Thursday.
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"The U.S. manufacturing sector continues to facesubstantial headwinds from the energy sector blow-out and as much as solid auto sector sales provide an offsetting element, today`s Chicago PMI is only expected to recover to 50.0 from a very limp rebound to 46.4 in May," Marc Ostwald, a strategist at ADM Investor Services, said in a note.
"By contrast, consumer confidence is forecast to extend last month`s rebound to 97.1 from 95.4, short of recent January (103.8) and March (101.4) cyclical peaks, but well above all 2014 readings," he said.
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