The U.S. 10-year Treasury yield eased after investors showed strong demand for a $39 billion auction, though the sale’s 5.3% yield was the highest since 2000.
The 10-year yield reached 5.35% earlier in Wednesday’s session, its highest level since 2002, before moving back to 5.286%. The 30-year yield also retreated from a 24-year peak to 5.666%.
Indirect bidders, including global central banks, bought 80.3% of the 10-year notes, above the 72.4% average for the previous 10 auctions. Direct bidders took 17.1%, while dealers bought 2.5%.
The sale was the second of three Treasury auctions scheduled this week. The government sold $58 billion in three-year notes on Tuesday and planned a $22 billion sale of 30-year bonds for Thursday.
Investors have been watching inflation and energy prices. Since the end of July, the 10-year yield has risen 60 basis points and U.S. crude prices have climbed 20%. Minutes from the Federal Reserve’s latest meeting showed most participants thought another rate increase could be appropriate by year-end, but gave no timetable.