Reply #91: Treasurys down after 5-yr. auction - Foreign central bank purchases seen [View All]

[UpInArms]

as weak

http://www.marketwatch.com/news/story.asp?guid=%7B8ECA536C%2D1739%2D45DA%2D9474%2DFD952E4E57A7%7D&siteid=mktw

NEW YORK (MarketWatch) - Long-term Treasurys fell in afternoon trade, pushing yields higher, amid disappointment that the U.S. Treasury's $15 billion auction of new five-year notes featured an apparently weak showing by foreign central banks and a low bid-to-cover ratio.

In recent trades, the five-year note was down 3/32 at 99-24/32 with a yield of 4.05%, while the 10-year bond traded off 9/32 at 96-28/32 with a yield of 4.39%.

The two-year bill was unchanged at 100-4/32 with a 3.67% yield.

The 30-year bond fell 21/32 to 110-2/32 with a yield of 4.70%.

Treasurys slipped into negative territory after news that indirect bidders, a category that includes foreign central banks, slipped to 28% from 43% at the most recent five-year bond auction.

In the past the five-year bond was considered a favorite holding of many foreign central banks. But lately the Treasurys market has been undermined by fears that these institutions are diversifying their reserves into the euro and shedding dollar-denominated assets

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