Bond prices were little changed on Wednesday after of the U.S. government's auction of three-year Treasury notes, the second of three debt auctions this week.
The Treasury Department auctioned $24 billion in 10-year notes at a high yield of 2.365 percent. The bid-to-cover ratio, an indicator of demand, was 2.52, versus a recent average of 2.70.
Benchmark 10-year Treasurys pared earlier gains and were last up 3/32 to yield 2.35 percent. Meanwhile, 30-year bonds rose 7/32 in price, bringing the yield down to 3.08 percent.
Indirect bidders, which include major central banks, were awarded 44.7 percent and direct bidders, which includes domestic money managers, brought 13.4 percent. Each were a bit below average.
U.S. Treasurys edged higher earlier as lingering concerns about economic growth overseas drove demand for safe-haven U.S. government debt, but remaining auctions of U.S. government debt limited gains.
Traders reentered the U.S. bond market after thin trading Monday and a market close on Tuesday for the Veterans Day holiday and found reason to seek safe-haven Treasuries due to ongoing concerns over economic weakness in Europe, analysts said.
"The Treasury market continues to be the beneficiary of the uncertainty going on," said Charles Comiskey, head of Treasurys trading at Bank of Nova Scotia in New York. "The money just flows to the safety and security of the U.S."
Analysts said recent weak European economic data and the continued threat of disinflation in the region spurred traders who had taken profits on U.S. Treasuries ahead of Tuesday's holiday to reenter the U.S. government debt market with greater confidence.
In morning U.S. trading, 528,000 contracts of December 10-year T-note futures changed hands, already marking roughly half of Monday's volume and suggesting more normal levels relative to recent days.
"The bond market seems to be focused more on the auctions this week," said Sharon Stark, fixed income strategist at DA Davidson in St. Petersburg, Florida. Analysts said Treasuries prices would likely dip ahead of the auctions as traders seek to sell U.S. government debt with the aim of buying it back at cheaper prices.