Treasury Yields Decline After Strong 10-year Auction

Treasury yields declined on Wednesday afternoon, losing part of their morning gains, after a well-received $21 billion auction in 10-year Treasury notes sparked a rally in the secondary market. The strong demand in the auction resulted in a closing yield of 1.925%, 0.4 basis points short of the market's expectations. Benchmark 10-year Treasurys have rallied following eight of the past nine auctions, Thomas Simons, an economist at broker-dealer Jefferies LLC, said in a note. Indirect bidders, a group that includes foreign central banks, took down 58.5% of the auction, the third largest indirect takedown since December 2011.

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