The US Treasury's auction of $69 billion in 2-year notes drew a high yield of 4.204%, slightly below the when-issued yield of roughly 4.208% at the 1 p.m. New York time bidding deadline, signaling demand that came in a touch firmer than market expectations. This marks the fourth consecutive month that 2-year Treasury auctions have been met with solid uptake.

At the time of the auction result release, the 2-year yield was down about 3 basis points on the day. Following the announcement, the front end of the yield curve maintained its upward momentum, with the spread between 2-year and 10-year yields holding near 44 basis points, a narrowing of roughly 2 basis points from the prior session.

Primary dealers took down 10.9% of the offering, a slight uptick from the previous auction. Indirect bidders, a category that includes foreign central banks, saw their allocation rise to 66%, the highest level since March 2025, more than offsetting the drop in direct bidder allotments to 23.1%. The bid-to-cover ratio came in at 2.60 times, modestly below the 2.61 times average seen over the prior six auctions.