Treasuries Fall After Durable Goods, Five-Year Auction

Treasuries fluctuated before the government sells $35 billion in five-year securities, the second of three note sales this week totaling $99 billion.

Ten-year note yields touched a two-week low as investors sought safety after durable-goods orders trailed forecasts and the Federal Reserve bought the biggest percentage of debt offered by dealers since January. The Fed bought $4.81 billion of Treasuries today due from August 2020 to November 2021. Stocks fell.

“You’re facing weaker equity markets and a programmatic buyer, so why fight it?” said Chris Ahrens, head U.S. interest- rate strategist at UBS AG in Stamford, Connecticut, one of the 21 primary dealers that trade with the Fed. The Fed purchase is “obviously helping support the sector in general.”

Benchmark 10-year note yields fell less than one basis point, or 0.01 percentage point, to 2.18 percent at 12:23 p.m. New York time, after touching 2.16 percent, the lowest since March 14. They increased earlier to 2.22 percent, according to Bloomberg Bond Trader prices.

Five-year notes yielded 1.01 percent after rising earlier to as high as 1.05 percent.

The U.S. central bank bought 42 percent of the amount of Treasuries that dealers offered to it today, the biggest percentage since Jan. 31. The average at the past five purchases is 31 percent. Fed Chairman Ben S. Bernanke said yesterday unemployment remains too high and the recovery in the U.S. economy isn’t assured.

To contact the reporter on this story: John Detrixhe in New York at jdetrixhe1@bloomberg.net

To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net

6:25

(Corrects reporter's name.) March 28 (Bloomberg) -- Troy Gayeski, senior portfolio manager at SkyBridge Capital LLC, discusses the outlook for U.S. equities and bonds. He speaks with Scarlet Fu, Stephanie Ruhle and Adam Johnson on Bloomberg Television's "InsideTrack." (Source: Bloomberg)

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March 28 (Bloomberg) -- Orders for U.S. durable goods rose in February, the fourth monthly gain in the last five, spurred by demand for cars, computers and capital equipment. Bookings for goods meant to last at least three years advanced 2.2 percent, less than projected after a revised 3.6 percent decline the prior month, data from the Commerce Department showed. Michael McKee and Betty Liu report on Bloomberg Television's "In the Loop." (Source: Bloomberg)