The U.S. Treasury's auction of $35 billion of 5-year bonds saw a high yield of 1.436 percent and a bid-to-cover ratio of 2.67. Following the sale, Treasury bonds remained higher.
Overall demand for the 5-year Treasury sale was the highest since May.
Treasurys were also bolstered by data on new home sales and on orders for long-lasting manufactured goods last month. The figures supported the outlook for accommodative monetary policy from the Federal Reserve.
Benchmark 10-year notes rose 5/32 in price, their yields easing to 2.62 percent from 2.66 percent late on Tuesday.
Meanwhile, the debate over the nation's debt remained on the minds of traders. Treasury Secretary Jack Lew said the hotly-debated debt ceiling was projected to run out by the middle of next month, ramping up pressure on Congress to pass a 'clean' debt bill.
--By Reuters with CNBC.com