London, Aug 20: US Treasuries were barely changed in idle London trade on Wednesday as the holiday season and a lack of surprises on interest rates muted activity, traders said.

"Volumes are very thin, it's August," said one dealer. "It's the summer blues the dollar is looking quite strong so my own feeling is the bond market should advance, but everyone's looking over their shoulder at the moment."

Treasuries pulled back modestly in Asia after the Federal Open Market Committee left US rates on hold, as expected. By 09:30 GMT, the 30-year long bond was at 98-05 to yield 6.52 percent, up from 98-04 in Tokyo but still off the 98-07 New York close.

Analysts said the only speculation surrounding Tuesday's meeting was whether the Fed had maintained its tightening bias. "Given Greenspan's Humphrey Hawkins testimony and the way the numbers have panned out recently, particularly on inflation, the Fed may have removed its tightening bias - but I suspect it didn't," said Michael Derks, cross market fixed income strategist at Deutsche Morgan Grenfell in London. "I would not be surprised if the Fed do not hike rates this year."

The minutes from the previous FOMC meeting on July 1-2 are due on Thursday at 18:00 GMT.

Analysts said a dearth of data would leave the market floundering for direction near term. The aftermath of the UPS strike and two and five year note auctions next week will provide some focus, but volume will likely be thin, they said.

The only figures due out of the US on Wednesday were June international trade numbers, due at 1230 GMT. Analysts expected a $10.36 billion deficit after a $10.23 billion shortfall in the previous period, according to a Reuter poll.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.