Sept. 11 (Bloomberg) -- Treasuries were little changed, with the 10-year note heading for a fifth week of gains, as demand for government debt fueled optimism nations will be able to fund measures to revive their economies. Thirty-year bonds were also set for a weekly advance after the government received bids for 2.92 times the $12 billion of the securities offered yesterday, the highest so-called bid-to- cover ratio since November 2007. The country’s auctions totaled $70 billion this week, part of an unprecedented amount of debt sold this year to finance a record budget deficit. “The 30-year auction yesterday showed a stellar result,” said Kornelius Purps, a fixed-income strategist at UniCredit SpA in Munich. “Demand for U.S. Treasuries is apparently still extremely strong and all the fears about too much supply are absolutely overdone. There is a positive sentiment towards the U.S. debt market.” The yield on the benchmark 10-year note was little changed at 3.35 percent as of 11 a.m. in London, according to BGCantor Market Data. The 3.625 percent security maturing in August 2019 rose 1/32, or 31 cents per $1,000 face amount, to 102 9/32. Yields have dropped 9 basis points this week. Thirty-year yields were little changed at 4.20 percent today. The Treasury has sold $442 billion of notes and bonds this quarter, after selling $963 billion in the first half of the year. Even with the added supply, Treasuries have returned 1.79 percent since June, including reinvested interest, after losing 4.46 percent in the first half, according to Merrill Lynch & Co index data. Auctions Record This week’s auctions kicked off with the sale of a record $38 billion in three-year notes on Sept. 8. The securities yielded 1.487 percent, the lowest level since May and below the average dealer forecast of 1.50 percent in a survey before the 1 p.m. bidding deadline. A day later the government sold $20 billion of 10-year notes at a yield of 3.51 percent, compared with an average forecast of 3.53 percent. Yesterday’s 30-year bond auction drew a yield of 4.238 percent, below the 4.289 percent forecast. Federal Reserve Bank of Atlanta President Dennis Lockhart said yesterday that the recovery will probably be “lackluster,” hobbled by strains in financial markets and weak consumer spending. Later in the day, Fed Vice Chairman Donald Kohn said in a speech in Washington that a “large and rapid rise” in short-term rates is unlikely because of low inflation and a feeble world economy. To contact the reporter on this story: Anna Rascouet in London arascouet@bloomberg.netTheresa Barraclough in Tokyo at tbarraclough@bloomberg.net.

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