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Three-Year Note Auction Attracts Well Below Average Demand

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Three-Year Note Auction Attracts Well Below Average Demand

The Treasury Department kicked off this week’s announcements of the results of its long-term securities auctions on Tuesday by revealing that its auction of $38 billion worth of three-year notes attracted well below average demand.

The three-year note auction drew a high yield of 0.563 percent and a bid-to-cover ratio of 2.20.

Last month, the Treasury also sold $38 billion worth of three-year notes last month, drawing a high yield of 1.394 percent and a bid-to-cover ratio of 2.56.

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 2.49.

Looking ahead, the Treasury is due to announce the results of its auction of $24 billion worth of ten-year notes on Wednesday and the results of its auction of $16 billion worth of thirty-year bonds on Thursday.

The material has been provided by InstaForex Company – www.instaforex.com