U.S. Treasury debt prices fell on Tuesday, bumping benchmark 10-year yields above 2 percent for the first time in a month as investors positioned for a probable rate hike by the Federal Reserve and big government bond auctions.
The Treasury Department auctioned $24 billion in three-year notes at a high yield of 1.050 percent. The bid-to-cover ratio, an indicator of demand, was 3.34, compared to a recent average of 3.29.
Indirect bidders, which include major central banks, were awarded 49 percent, well above the 35 percent average. Direct bidders, which includes domestic money managers, brought 7.2 percent, versus a recent average of 18 percent.
Ten-year Treasury notes on Tuesday yielded as much as 2.016 percent, a high last seen on January 9, and were last trading at 1.997 percent, down 5/32 in price.
Thirty-year bond yields were last trading at 2.584 percent, reflecting a price decline of 21/32, after touching a session high of 2.596 percent.
The Treasury department is scheduled to auction $24 billion of 10-years on Wednesday and $16 billion of 30-years on Thursday.
"That's four consecutive down days, and we are still showing some of the hangover from the good nonfarm payrolls report on Friday," said Guy LeBas, chief fixed income strategist at Janney Montgomery Scott LLC in Philadelphia.