Five-Year Note Auction Attracts Below Average Demand

(RTTNews) - On the heels of yesterday's auction of $26 billion worth of two-year notes, the Treasury Department sold $34 billion worth of five-year notes on Tuesday, attracting below average demand.

The five-year note auction drew a high yield of 1.218 percent and a bid-to-cover ratio of 2.29.

The Treasury also sold $34 billion worth of five-year notes last month, drawing a high yield of 1.395 percent and a bid-to-cover ratio of 2.60.

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 five-year note auctions had an average bid-to-cover ratio of 2.45.

On Wednesday, the Treasury is due to finish off this week's series of long-term securities auctions with the sale of $28 billion worth of seven-year notes.