Treasuries Close Slightly Higher Following Lackluster Session

(RTTNews) - Treasuries showed a lack of direction throughout much of the trading session on Wednesday before ending the day slightly higher.

Bond prices saw modest strength in afternoon trading but finished the session off their best levels of the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 1.706 percent.

The choppy trading seen in the bond market came as traders seemed reluctant to make any significant moves amid a lack of major U.S. economic data.

Traders also stuck to the sidelines ahead of the Federal Reserve's monetary policy announcement scheduled for next Wednesday.

Recent data seems to have eliminated the possibility that the Fed will raise interest rates, but traders are likely to keep a close eye on the central bank's accompanying statement.

Treasuries showed little reaction to the results of the Treasury Department's auction of $20 billion worth of ten-year notes, which attracted slightly above average demand.

The ten-year note auction drew a high yield of 1.702 percent and a bid-to-cover ratio of 2.70, while the ten previous ten-year note auctions had an average bid-to-cover ratio of 2.62.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

Trading on Thursday may be impacted by reaction to U.S. reports on weekly jobless claims and wholesale inventories.

Bond traders are also likely to keep an eye on the results of the Treasury's auction of $12 billion worth of thirty-year bonds.