The 10-year note yield, which falls as prices rise, was down half a basis point at 2.690%, marking its fourth consecutive session of falling yields. The 30-year bond yield slipped a basis point to 3.548%, while the 3-year note yield was up a basis point at 0.853%, according to Tradeweb.
The 3-year notes sold at a yield of 0.895%. Bidders offered to buy 3.36 times the amount of debt for sale, compared with 3.33 times during the past six sales.
Direct bidders, which include domestic money managers, took down 24.0% of the sale, compared with a recent average of 17.7%. Indirect bidders, which often include foreign central banks, took down 27.3%, versus the recent average of 34.3% during the past six sales. Altogether, non-dealer takedown was in line with past auctions.
The Treasury Department will also sell $21 billion in 10-year notes on Wednesday and $13 billion of 30-year bonds on Thursday.
Treasurys have rallied in recent sessions following a tepid payrolls report that showed improvement in some key sectors of the labor market, but lagged behind ramped-up expectations for the headline number of jobs created. The tone of steady, yet sluggish economic growth challenged expectations for an acceleration as the winter weather fades.
Investors largely expect rates to rise as the economy lifts off, leading the Federal Reserve to normalize monetary policy in the coming years. However, Fed chairwoman Janet Yellen suggested last week that the current labor market demands accommodative monetary policy.
“Despite hearing daily from both investors and other strategists that ‘we are in clear recovery on growth and that 2014 will be a good year for [the] stock market again,’ I remain extremely disappointed on the real progress made in terms of structural and cyclical improvement in key indicators,” said Steen Jakobsen, chief investment officer at Saxo Bank, in a note. He forecasts that U.S. 30-year bond yields will fall 150 basis points toward 3.50%, making fixed-income the only positively-performing asset class by the end of 2015.