U.S. treasuries rose after a recent auction $35 billion of two-year notes required less yield than expected. Later in the week, auctions are planned for $64 billion worth of five- and seven-year notes. This indicates a general risk-off attitude, and comes at the same time as consumer confidence and home prices have declined. U.S. treasuries continue to enjoy haven demand.
Volume was slightly higher than expected, and indirect bidders (which includes foreign central banks) made up a higher percentage of purchases (34.3 versus 32.1 percent for the past 10 sales). If conditions in Europe were to worsen, demand for U.S. exports is expected to drop, according to The New York Fed’s Dudley.
Source: Bloomberg
