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.