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Three-Year Note Auction Attracts Below Average Demand

Kicking off this week's announcements of the results of its long-term securities auctions, the Treasury Department revealed Tuesday its auction of $38 billion worth of three-year notes attracted below average demand.

The three-year note auction drew a high yield of 1.562 percent and a bid-to-cover ratio of 2.41.

Last month, the Treasury also sold $38 billion worth of three-year notes, drawing a high yield of 1.857 percent and a bid-to-cover ratio of 2.39.

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 2.52.

Looking ahead, the Treasury is due to announce the results of its auctions of $27 billion worth of ten-year notes and $19 billion worth of thirty-year bonds on Wednesday and Thursday, respectively.

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