Treasurys higher after auction

Prices for U.S. debt hold gains after the government sells $37 billion worth of 3-year notes.

EMAIL  |   PRINT  |   SHARE  |   RSS
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all RSS FEEDS (close)
By Ben Rooney, staff writer

Click the chart for current bond prices and yields.
When do you think the economy will improve?
  • In the next few months
  • In six months to a year
  • In a year or more
  • It's already on the mend

NEW YORK ( -- Treasury prices held earlier gains Tuesday after the government saw strong demand for its sale of $37 billion worth of 3-year notes.

The Treasury said it received $107.7 billion worth of bids for the $37 billion worth of notes sold. That made for a bid-to-cover ratio of 2.89, well above the long-term average of 2.56 for the securities.

Indirect bidders, a category that includes foreign central banks, bought more than 62% of the notes.

Tuesday's auction was the first of three offerings this week totaling $75 billion. The U.S. will auction $23 billion in 10-year notes Wednesday and $15 billion in 30-year bonds on Thursday as part of its quarterly refunding.

The record offering is the latest in a string of large debt sales the government has held monthly as it seeks to fund a growing deficit and spur the ailing economy out of recession.

The onslaught of new issues has raised concern that demand for Treasurys is wearing thin. Last month, auctions of 2-year and 5-year notes received lower than average bid-to-cover ratios, which reflect the market's appetite for the securities.

While Tuesday's auction was well received, analysts say Wednesday's 10-year and Thursday's 30-year auctions could encounter some resistance.

"The longer dated securities will be what the market is going to be focused on," said Bill Larkin, a fixed-income trader at Cabot Money Management.

Meanwhile, stocks tumbled Tuesday as investors responded to a worse-than-expected reading on wholesale inventories and an ongoing meeting of the Federal Reserve.

Analysts expect the central bank to hold interest rates steady near zero percent, but investors will pay close attention to the Fed's statement for details on its outlook and its plan to purchase $300 billion worth of U.S. debt, which is due to wind down in September.

An announcement is expected at 2:15 p.m. ET Wednesday.

Separately, the Fed purchased $2.7 billion worth of Treasurys maturing between 2026 and 2039 on Tuesday. The aim is to keep interest rates lower on certain consumer loans such as mortgages and to boost the economy.

Bond prices: The benchmark 10-year note was up 27/32 to 95-17/32. Its yield fell to 3.67% from 3.77% late Monday. Bond prices and yields move in opposite directions.

The 30-year bond gained 1-19/32 to 96-30/32 and its yield eased to 4.43%.

The 2-year note edged up 3/32 to 99-18/32. Its yield was 1.16%.

The yield on the 3-month Treasury bill was 0.18%.  To top of page

They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
10 of the most luxurious airline amenity kits When it comes to in-flight pampering, the amenity kits offered by these 10 airlines are the ultimate in luxury More
7 startups that want to improve your mental health From a text therapy platform to apps that push you reminders to breathe, these self-care startups offer help on a daily basis or in times of need. More
5 radical technologies that will change how you get to work From Uber's flying cars to the Hyperloop, these are some of the neatest transportation concepts in the works today. More
Worry about the hackers you don't know 
Crime syndicates and government organizations pose a much greater cyber threat than renegade hacker groups like Anonymous. Play
GE CEO: Bringing jobs back to the U.S. 
Jeff Immelt says the U.S. is a cost competitive market for advanced manufacturing and that GE is bringing jobs back from Mexico. Play
Hamster wheel and wedgie-powered transit 
Red Bull Creation challenges hackers and engineers to invent new modes of transportation. Play

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.