US Treasury Auctions See Mixed Demand, 10-Year Notes Attract Strong Bids

• US Treasury auctioned $58 billion 3-year notes and $39 billion 10-year notes.
• 3-year notes saw average demand at 4.932% yield.
• 10-year notes attracted strong demand at 5.300% yield, boosting Treasuries.

The U.S. Treasury Department concluded its auctions for $58 billion in three-year notes and $39 billion in ten-year notes this week, with the thirty-year bond auction scheduled for next Thursday. The $58 billion three-year note auction on Tuesday attracted average demand, clearing at a high yield of 4.932% with a bid-to-cover ratio of 2.62X. In contrast, Wednesday’s $39 billion ten-year note auction saw strong demand, achieving a high yield of 5.300% and a bid-to-cover ratio of 2.77X, which was above average. This strong demand for ten-year notes, with the yield coming in 1.7 basis points below the ‘when-issued’ level, contributed to a rise in U.S. Treasuries, signaling investor interest as yields reach multi-decade highs. The upcoming $22 billion thirty-year bond auction will complete this series of long-term securities sales.