Treasurys Trade Higher After 5-year Auction Sees Heavy Demand

Treasurys traded higher Tuesday after an auction of $35 billion in 5-year notes saw high demand from foreign investors as European bond yields remain stubbornly low. The auction's bid-to-cover ratio was 2.91, compared to an average of 2.64 from the last four auctions. A higher ratio indicates greater demand. Indirect bidders, a group that includes foreign central banks, took home 65% of the bonds, compared to an average of 36% over the last four auctions. The yield at auction was 1.595%, compared to a 1.611% yield at 1 p.m., just minutes before the auction's results were announced. Yields move inversely to prices. The 5-year note yield was down 1.9 basis points on the day to 1.583% in recent trading.