NEW YORK — Treasurys rose as speculation that U.S. lawmakers will reach an agreement to raise the nation’s debt limit in time to avoid a default boosted investor demand at Tuesday’s auction of $35 billion in two-year notes.
The securities drew a yield of 0.417 percent, versus the average forecast of 0.414 percent in a Bloomberg News survey of seven Federal Reserve primary dealers.
The bid-to-cover ratio, which gauges demand by comparing total bids with the amount of securities offered, was 3.14, higher than the average of 2.38 from 1998 through 2001, when the U.S. had four straight years of budget surpluses.
Thirty-year bond yields dropped four basis points, or 0.04 of a percentage point, to 4.28 percent at 5:02 p.m. in New York, according to Bloomberg Bond Trader prices. Bloomberg News
