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By Lynn Adler

NEW YORK, April 12 (Reuters) - U.S. agency debt spreads
finished little changed in thin Monday dealings, tracking
slightly weaker Treasuries before a wave of new economic data
and $5 billion in Freddie Mac note issuance.

There was talk of some selling ahead of Freddie Mac's $4
billion new three-year note and $1 billion 10-year note
reopening on Thursday, but both sales were said to be shaping
up soundly in pre-sale business.

Freddie Mac's existing 10-year note maturing January 2014
was bid at 46 basis points and offered 45.5 basis points over
Treasuries late on Monday, roughly half a basis point wider
than late Thursday.

The U.S. bond markets were closed for Good Friday.

Treasuries slipped, with benchmark 10-year note <US10YT=RR>
yields ending just shy of three-month highs seen earlier on
Monday before economic data that may underscore a recovery
trend.

Prospects for another quarter of low, or negative, net
noncallable debt issuance is expected to keep a floor under the
agency market, strategists said.

Mortgage securities remain costly, curbing the agencies'
portfolio growth and their need for long-term agency debt
issuance to fund such purchases.

Callable debt issuance, however, is expected to stay
robust. This type of debt is a key risk management tool, with
interest rates still low and mortgage refinancings still rapid,
lessening the duration of assets held in the agencies'
portfolios.

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