Treasury Department auctions $27 billion of 3-year notes at a high yield of 0.994%

US 10-YR
US 30-YR

The Treasury Department auctioned $27 billion in three-year notes at a high yield of 0.994 percent. The bid-to-cover ratio, an indicator of demand, was 3.42.

This is a breaking news story. Please check back for updates.

U.S. sovereign bond prices ticked higher for the second straight session Tuesday, with benchmark yields hitting their lowest in over a month, after fresh signs of economic weakness in Germany and a lower International Monetary Fund global growth forecast fueled safe-haven bids.

German industrial production plunged 4.0 percent in August, the Economy Ministry said, the biggest drop since January 2009, raising concerns that Europe's largest economy is running out of steam. The data came a day after weak German industrial orders and euro zone investor sentiment data.

The IMF cut its global economic growth forecasts to 3.3 percent this year and 3.8 percent next year from forecasts in July of 3.4 and 4 percent, respectively.

Read MoreInvestors cautious ahead of midweek earnings and Fed

They will be closely watched for hints on the timing of the first interest rate rise. Friday's jobs report indicated a modest growth in U.S. hourly earnings, leading some to believe the Fed could postpone a rate hike for some time.

The yield on benchmark 10-year Treasury notes—used to calculate mortgage rates and other consumer loans—was around 2.37 percent, up 13/32 in price.

The Treasury is scheduled to auction $27 billion in 3-year notes on Tuesday.

Read More'Nuanced'dollar gains as monetary policy diverges

"Auction performance at the 3-year sector remains mixed despite improving demand," Barclays analysts said in a note. "We believe that there is more room for current 3s to cheapen versus old, as experience over the past few auction cycles suggests that current 3s continue to cheapen relatively until 2-3 business days after the auction."

Earlier, Job openings, a gauge of labor demand, rose to 4.8 million in August, up from 4.6 million in July, while the quit and layoff figures were little at 2.5 million and 4.4 million, respectively, according the Labor Department's monthly Job Openings and Labor Turnover Survey.

Federal Reserve Chair Janet Yellen relies on the JOLTS report as a barometer for economic conditions as the Central Bank considers its next step on monetary policy.

Minneapolis Fed President Narayana Kocherlakota and New York Fed President William Dudley are due to speak on Tuesday, ahead of minutes from the Federal Open Market Committee (FOMC)'s latest meeting on Wednesday.

The consumer credit report will be released at 3 p.m. ET and Yum! Brands will report its quarterly earnings after the market close.

Reuters contributed to this report.