Twenty-Year Bond Auction Attracts Well Below Average Demand

(RTTNews) - The Treasury Department announced the results of this month's auction of $16 billion worth of twenty-year bonds on Wednesday, revealing the sale attracted well below average demand.

The twenty-year bond auction drew a high yield of 4.664 percent and a bid-to-cover ratio of 2.36.

Last month, the Treasury sold $13 billion worth of twenty-year bonds, drawing a high yield of 4.846 percent and a bid-to-cover ratio of 2.86.

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 twenty-year bond auctions had an average bid-to-cover ratio of 2.65.

Last week, the Treasury announced the results of this month's auctions of $58 billion worth of three-year notes, $42 billion worth of ten-year notes and $25 billion worth of thirty-year bonds.

The three-year note auction attracted average demand, the ten-year note auction attracted below average demand and the thirty-year bond auction attracted well above average demand.

On Thursday, the Treasury is due to announce the details of this month's auctions of two-year, five-year and seven-year notes.