U.S. Treasury prices were higher on Tuesday, after a sale of three-year notes and as crude oil prices dipped beelow per barrel.
The Treasury Department auctioned $24 billion in three-year notes at a high yield of 1.174 percent. The bid-to-cover ratio, an indicator of demand, was 2.94. Indirect bidders, which include major central banks, were awarded 62.8 percent. Direct bidders, which include domestic money managers, brought 9.4 percent.
"Bottom line, the obvious key for the short end of the curve this year is whether the Fed hikes rates again. Their models will tell them to raise again as the labor market tightens and the Fed holds out hope that oil prices stop going down and thus leads to a rise in headline inflation (core inflation should remain sticky)," Peter Boockvar, chief market analyst at The Lindsey Group, said in a note after the auction.
Benchmark 10-year notes rose to yield 2.1129 percent, down from a closing yield of 2.158 percent. Bond prices move inversely to yields.
Thirty-year bonds yielded 2.8928 percent, down from 2.957 percent at the close. Three-year notes yielded 1.1599 after the sale.