Two-Year Note Auction Attracts Above Average Demand

(RTTNews) - The Treasury Department kicked off this week's series of long-term securities auctions with the sale of $29 billion worth of two-year notes on Tuesday, attracting above average demand.

The two-year note auction drew a high yield of 0.589 percent and a bid-to-cover ratio of 3.56.

Last month, the Treasury also sold $29 billion worth of two-year notes, drawing a high yield of 0.530 percent and a bid-to-cover ratio of 3.48.

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 two-year note auctions had an average bid-to-cover ratio of 3.42.

Peter Boockvar, managing director at the Lindsey Group, said, "Bottom line, the yield at a multi-year high was attractive enough to buyers."

Looking ahead, the Treasury is due to sell $35 billion worth of five-year notes on Wednesday and $29 billion worth of seven-year notes on Thursday.