The Treasury Department completed its weekly 3 and 6-month bill auctions Monday afternoon. The sales posted notably strong demand, as investors moved into secure investments amid profit taking on Wall Street.
The auction for $30.0 billion worth of 3-month bills drew a high yield of 0.200 percent while posting stronger than usual demand, with the bid-to-cover ratio coming in at a level of 3.43. The security is scheduled to mature July 9th, 2009.
Despite the government ramping up offerings over the past three months, the short-term security has enjoyed substantial demand, posting a bid-to-cover ratio of at least 3.0 in each of the previous seven auctions.
The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.
Previously, the government sold $31.0 billion worth of 3-months bills, with the sale drawing a yield of 0.195 percent. The auction posted a bid-to-cover ratio of 3.09.
Earlier this afternoon, the Treasury Department sold $28.0 billion worth of 6-month bills, with the auction drawing a high-yield of 0.400 percent and a bid-to-over ratio of 3.33. The bond is set to mature October 8th, 2009.
The previous auction for comparable securities took place early last week, when the government sold $29.0 billion worth of 6-month bills. The auction drew a yield of 0.420 percent, while the bid-to-cover ratio came in at a level of 2.88.
Earlier today, the government announced details for its auction of ten and three-year notes, set to take place later this week.
Traders will be especially focused on the results of the ten-year note auction, as the security is known as a benchmark in the bond market.
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