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Two-Year, Five-Year Note Auctions Attract Below Average Demand

The Treasury Department announced the results of this month's auctions of $58 billion worth of two-year notes and $59 billion worth of five-year notes on Monday.

The results revealed the two-year note auction drew well below average demand, while the five-year note auction drew slightly below average demand.

The two-year note auction drew a high yield of 0.623 percent and a bid-to-cover ratio of 2.36.

Last month, the Treasury sold $60 billion worth of two-year notes, drawing a high yield of 0.481 percent and a bid-to-cover ratio of 2.69.

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 2.53.

Meanwhile, the five-year note auction drew a high yield of 1.319 percent and a bid-to-cover ratio of 2.34.

The Treasury sold $61 billion worth of five-year notes last month, drawing a high yield of 1.157 percent and a bid-to-cover ratio of 2.55.

The ten previous five-year note auctions had an average bid-to-cover ratio of 2.37.

Looking ahead, the Treasury is due to announce the results of this month's auction of $59 billion worth of seven-year notes on Tuesday.

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