The yield on the benchmark 10-year Treasury notes, which moves inversely to price, hit its highest level since 2014 in the previous session. On Tuesday, it was lower at around 2.4779 percent, while the yield on the 30-year Treasury bond was also lower at 3.1416 percent.
The yield on the 2-year Treasury note rose to 1.174 percent before closing at 1.169 percent. Both figures represent its highest intraday and close since April 2010.
The U.S. Treasury Department auctioned $12 billion in 30-year bonds at a high yield of 3.152 percent, the highest 30-year auction yield since September 2014.
The bid-to-cover ratio, an indicator of demand, was 2.39, well above a 2.28 average. Indirect bidders, which include major central banks, were awarded 63.9 percent, almost 2 better than a recent average. Direct bidders, which includes domestic money managers, bought 9.3 percent, versus a 9 percent recent average.
On the data front, the November read on the NFIB Small Business index came in at 98.4, above October's 94.9. Import prices for November fell 0.3 percent.
In oil markets, Brent crude traded at around $55.62 a barrel on Tuesday, down 0.13 percent, while U.S. crude was around $52.73 a barrel, down 0.21 percent.
The International Energy Agency (IEA) released its monthly oil report on Tuesday and forecast global oil demand to increase at a quicker pace than expected in 2016 and 2017. The IEA said it was too soon to judge the impact of the joint production cut from OPEC and non-OPEC oil producing nations.