2014.04.2314:26:00UTC+00Five-Year Note Auction Attracts Above Average Demand

Following yesterday's auction of $32 billion worth of two-year notes, the Treasury Department sold $35 billion worth of five-year notes on Wednesday, attracting above average demand.

The five-year note auction drew a high yield of 1.732 percent and a bid-to-cover ratio of 2.79.

Last month, the Treasury also sold $35 billion worth of five-year notes, drawing a high yield of 1.715 percent and a bid-to-cover ratio of 2.99.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

The ten previous five-year note auctions had an average bid-to-cover ratio of 2.62.

"Following a mixed two-year auction yesterday where dealers got stuck with a lot of the paper, the five-year today was also mixed," said Peter Boockvar, managing director at the Lindsey Group. "The yield was above the when issued but the bid to cover was above the 12 month average."

Finishing off this week's series of long-term securities auctions, the Treasury is due to sell $29 billion worth of seven-year notes on Thursday.