WASHINGTON (dpa-AFX) - After ending the previous session modestly lower, treasuries moved back to the upside over the course of the trading day on Tuesday.
Bond prices initially moved lower but climbed into positive territory as the day progressed. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.5 basis points to 1.910 percent.
The rebound by treasuries came after the Treasury Department revealed that its auction of $41 billion worth of five-year notes attracted above average demand.
The five-year note auction drew a high yield of 1.756 percent and a bid-to-cover ratio of 2.49, while the ten previous five-year note auctions had an average bid-to-cover ratio of 2.39.
The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.
Trading activity remain relatively subdued, however, as some traders look to get a head start on the Christmas holiday on Wednesday.
A lack of major U.S. economic data also kept traders on the sidelines along with an earlier than usual close for the markets.
Following the holiday, trading activity is likely to remain relatively subdued on Thursday, although a report on weekly jobless claims may attract some attention.
The Treasury Department is also due to announce the results of its auction of $32 billion worth of seven-year notes.
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