The Treasury Department completed its auctions of 52-week and 4-week bills late Tuesday morning. The demand for the bills was strong despite the government increasing the size of the offerings in recent months.
The auction of $25.0 billion worth of 52-week bills drew a high yield of 0.590 percent while posting strong demand, with the bid-to-cover ratio coming in at a level of 3.30. The security is scheduled to mature April 8th, 2010.
The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.
The previous auction for comparable securities took place early last month, when the Treasury sold $24.0 billion worth of the securities. The auction drew a yield of 0.7 percent, while attracting strong demand, with the bid-to-cover ratio coming in at 3.51.
Separately, the government auctioned $28.0 billion worth of 4-week bills, with the sale drawing a high yield of 0.160 percent. The auction attracted strong demand, with the bid-to-cover ratio coming it at 3.41. The bond is set to mature May 7th, 2009.
The previous sale of the bills took place early last week, when $34.0 billion worth of the securities were sold. The auction drew a high yield of 0.170 and posted modest demand, with the bid-to-cover ratio coming in at 2.55.
At 1 p.m. ET, the Treasury Department plans to sell $6.0 billion worth of 10-year inflation immune treasuries, also called TIPS.
The previous auction was for $8.0 billion worth of the securities, drawing a yield of 2.245 percent while attracting strong demand, with the bid-to-cover ratio coming in at 2.48.
The results of the ten-year TIPS auction will be compared to the outcome of the regular ten-year note sale later in the week, with the spread indicative of near-term inflation.
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