Postponed Two-Year Note Auction Attracts Below Average Demand

(RTTNews) - After previously postponing the auction, the Treasury Department sold $26 billion worth of two-year notes on Wednesday, attracting below average demand.

The two-year note auction drew a high yield of 0.824 percent and a bid-to-cover ratio of 3.01.

The Treasury also sold $26 billion worth of two-year notes in September, drawing a high yield of 0.699 percent and a bid-to-cover ratio of 3.27.

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 3.37.

The two-year note auction was originally scheduled for October 27th but was postponed as a result of the debt limit impasse.

The rescheduled auction was announced last Friday after lawmakers approved a two-year budget agreement that also extended the nation's debt limit through 2017.

Earlier on Wednesday, the Treasury announced the details of next week's auctions of three-year and ten-year notes and thirty-year bonds.

The Treasury said it plans to sell $24 billion worth of three-year notes next Monday, $24 billion worth of ten-year notes next Tuesday and $16 billion worth of thirty-year bonds next Thursday.