Three-Year Note Auction Attracts Below Average Demand

The Treasury Department kicked off this week’s series of announcements of the results of its long-term securities auctions on Monday, revealing this month’s sale of $58 billion worth of three-year notes attracted below average demand.

The three-year note auction drew a high yield of 4.659 percent and a bid-to-cover ratio of 2.43.

Last month, the Treasury also sold $58 billion worth of three-year notes, drawing a high yield of 4.605 percent and a bid-to-cover ratio of 2.63.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

The ten previous three-year note auctions had an average bid-to-cover ratio of 2.63.

Looking ahead, the Treasury is due to announce the results of this month’s auctions of $39 billion worth of ten-year notes and $22 billion worth of thirty-year bonds on Tuesday and Thursday, respectively.

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