Investing.com – The U.S. government sold $70 billion of 5-year bonds on Wednesday at lower-than-expected yields as demand for shorter-dated bonds remained steady amid expectations of a Federal Reserve rate cut sooner rather than later.
The bonds sold at 4.331%, below the pre-sale or issue rate of 4.335% and below the high of 4.553% seen in the previous auction, indicating continued strong demand at the bottom of the yield curve that typically reflects rates at maturity from 10 to two years.
The bid-to-cover ratio (a measure of demand) at the auction was 2.35, up from 2.30 at the previous auction.
Following the news, shares were trading at 4.327%, down from the day’s high of 4.343%.