(RTTNews) - After moving notably higher over the course of the previous session, treasuries saw some further upside during trading on Wednesday.
Bond prices gave back ground after an initial advance but remained in positive territory throughout the day. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, dipped 2.4 basis points to 1.466 percent.
With the continued decrease on the day, the ten-year yield once again ended the session at its lowest closing level in three years.
The early strength among treasuries pushed the ten-year yield further below the two-year yield, with the inversion seen as an indicator that a U.S. recession is looming.
Earlier in the day, the negative spread between the ten-year and two-year yields widened to its lowest level since 2007.
The White House has sought to downplay recession concerns, although the inverted yield curve combined with the escalating U.S.-China trade war have generated considerable uncertainty.
Treasuries saw continued strength in afternoon trading, as the Treasury Department revealed its auction of $41 billion worth of five-year notes attracted above average demand.
The five-year note auction drew a high yield of 1.365 percent and a bid-to-cover ratio of 2.48, while the ten previous five-year note auctions had an average bid-to-cover ratio of 2.35.
The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.
Looking ahead, the Treasury is due to announce the results of its auction of $32 billion worth of seven-year notes on Thursday.
Trading on Thursday may also be impacted by reaction to slew of U.S. economic data, including a revised reading on second quarter GDP and reports on weekly jobless claims and pending home sales.
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