NEW YORK, April 23 (Reuters) – Treasury yields were lower on Tuesday morning, with big moves in the two-, five- and seven-year note yields ahead of the auctions of all three maturities this week.
The U.S. government will sell $40 billion of two-year notes later on Tuesday. Although increased supply would theoretically drive prices lower, the two-year yield, which moves inversely to price, was down 2.7 basis points in mid-morning trade.
“Because yields have backed up so much, things look much more attractive now, even with the added supply,” said Mary Ann Hurley, vice president, fixed income trading at D.A. Davidson.
Tuesday’s move is a counter-trend in the broader move higher in yields in the last month. The two-year yield is a proxy for market