TREASURIES-U.S. bonds little changed on supply hedging

* Saudi Arabia launches $17.5 billion global bond deal * U.S. housing starts fall to 1-1/2 year low in September * Fed's Beige Book: signs of rising wage pressure * Traders await clues from ECB on bond purchase program (Updates after Fed releases Beige Book) By Richard Leong NEW YORK, Oct 19 (Reuters) - U.S. Treasury yields were little changed on Wednesday as dealers bought and sold government bonds to hedge securities they underwrote, which was led by Saudi Arabia's first-ever global bond issue. Saudi Arabia's $17.5 billion multipart debt offering drew heavy demand as the world's top oil exporter sought to borrow at historic low yields. Bond dealers typically sell Treasuries to hedge against an issue they underwrite and then buy them back after it is sold. "It's a huge deal. There's some rate-lock selling," said Mary Ann Hurley, vice president of fixed income with D.A. Davidson in Seattle. "As the Saudi deal gets put away, you could see some reversal of that rate-lock selling." Benchmark U.S. 10-year Treasury notes were up 1/32 in price to yield 1.743 percent, down half a basis point from late Tuesday. The 10-year yield remained below a four-month peak of 1.841 percent reached on Monday. The two-year yield was flat at 0.799 percent, and the 30-year yield was little changed at 2.508 percent. Bond yields swung a bit after data showed a 38 percent tumble in U.S. apartment construction in September, knocking overall home building activity to its weakest in 1-1/2 years. "That number is downright terrible," said Stan Shipley, a strategist at Evercore ISI in New York. Some analysts noted the report had a bright spot: domestic single-family home construction rose 8 percent to its strongest in seven months. The Federal Reserve's latest Beige Book, commenting on current economic condition and released on Wednesday, acknowledged moderate U.S. growth, with signs of rising wage pressure in September. Meanwhile, investors awaited possible clues on the European Central Bank's thinking on its 1 trillion-plus euro bond purchase program that may conclude as early as March 2017. Traders have been speculating over whether the ECB, which will hold a policy meeting on Thursday, would consider paring its quantitative easing as Europe keeps struggling with weak growth and faces Britain's exit from the European Union. "The market has come to realize central banks have pretty much done all they can to help markets," D.A. Davidson's Hurley said. "Still the ECB will maintain its accommodative stance." Oct. 19, Wednesday 2:08 EDT/1808 GMT Price US T BONDS DEC6 164-15/32 0-6/32 10YR TNotes DEC6 130-88/256 0-12/256 Price Current Net Yield % Change (bps) Three-month bills 0.3275 0.3323 -0.016 Six-month bills 0.4625 0.47 -0.010 Two-year note 99-230/256 0.8027 -0.008 Three-year note 100-34/256 0.9548 -0.008 Five-year note 99-134/256 1.2246 -0.011 Seven-year note 99 1.5273 -0.007 10-year note 97-208/256 1.7432 -0.005 30-year bond 94-152/256 2.5085 -0.003 DOLLAR SWAP SPREADS Last (bps) Net Change (bps) U.S. 2-year dollar swap 22.75 0.25 spread U.S. 3-year dollar swap 14.25 0.25 spread U.S. 5-year dollar swap 1.75 0.25 spread U.S. 10-year dollar swap -17.25 -0.25 spread U.S. 30-year dollar swap -57.25 -0.25 spread (Editing by Chizu Nomiyama, David Gregorio and Jeffrey Benkoe)

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