By Sam Mamudi, MarketWatch
NEW YORK (MarketWatch) — Treasury prices were flat in early trading Tuesday, ahead of the first of three note and bond auctions this week.
Yields on 2-year (UST2YR 0.57, -.00, -0.70%) and 10-year notes (UST10Y 3.30, +0.01, +0.24%) were unchanged at the latest at 0.57% and 3.29%, respectively. Yields on 10-year notes had ticked up 1 basis point earlier in the session.
Bond yields move inversely to prices. One basis point is one hundredth of a percentage point.
At 1 p.m. Eastern the Treasury Department will sell $32 billion in 3-year notes (UST3YR 0.95, -0.01, -0.53%) . On Wednesday, it will sell $21 billion in 10-year notes, with another auction, $13 billion in 30-year bonds (UST30Y 4.47, +0.01, +0.27%) , set for Thursday.
Tuesday morning, yields on 30-year bonds were up 1 basis point, to 4.48%.
Tuesday’s auction “should see decent demand as the 2yr - 3yr spread has steepened over the last week or so,” said Thomas di Galoma, head of U.S. fixed-income trading for Guggenheim Securities.
“We are a bit uncomfortable short term with the 10-year to 30-year sector because of supply but feel a run to 3.10% on 10-years is in the cards at some point in January,” added di Galoma.
Also Tuesday, the Federal Reserve will buy back between $7 billion and $49 billion in Treasury debt as part of its second round of quantitative easing. On Monday, the Fed bought $7.79 billion in debt.
