U.S. government debt yields fell on Tuesday as market participants await to hear from President Donald Trump.
Economic activity in the non-manufacturing sector grew in January for the 108th consecutive month, the nation's purchasing and supply executives said Tuesday. The Institute for Supply Management Non-Manufacturing index registered 56.7 percent, 1.3 percentage points lower than the December reading of 58 percent. The New Orders Index registered 57.7 percent, 5 percentage points lower than the reading of 62.7 percent in December.
President Donald Trump is due to address the Congress with his 2019 State of the Union Speech on Tuesday. Money managers will be looking for comments on trade and the broader U.S. economy.
On Monday, the President had an "informal meeting" with Fed Chairman Jerome Powell, where both discussed "recent economic developments and the outlook for growth, employment and inflation."
Trump, who nominated Powell to be Fed chairman, has been one of Powell's most vocal critics, blaming central bank rate increases for slowing the economy and roiling the stock market.
"I always feel it's important for two sides to hear each other and it reduces, but it doesn't eliminate, but reduces misunderstandings in the future," economist Mohamed El-Erian told CNBC on Tuesday. "I think net-net this is neutral to slightly favorable to the market. But it's not a big deal."
Meanwhile, the Treasury will auction $38 billion in 3-year notes.
Much of the action over the past week has stemmed from the Federal Reserve's monetary policy decision on Wednesday. The central bank kept the federal funds rate steady as expected, but also vowed to be "patient" when adjusting monetary policy in the future.