Treasuries Close Roughly Flat Following Lackluster Session

(RTTNews) - Following the rally seen in the previous session, treasuries showed a lack of direction throughout the trading day on Tuesday before closing roughly flat.

Bond price spent the day bouncing back and forth across the unchanged line, unable to sustain any significant moves. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 1.729 percent.

With the slight decrease on the day, the ten-year yield once again ended the session at its lowest closing level in a year.

The choppy trading came as traders stuck to the sidelines ahead of Federal Reserve Chair Janet Yellen's testimony before the House Financial Services Committee on Wednesday.

Traders are likely to pay close attention to Yellen's remarks in an effort to gain some insight into the outlook for interest rates.

Meanwhile, the markets largely shrugged off the results of the Treasury Department's auction of $24 billion worth of three-year notes, which attracted below average demand.

The three-year note auction drew a high yield of 0.844 percent and a bid-to-cover ratio of 2.74, while the ten previous three-year note auctions had an average bid-to-cover ratio of 3.17.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

Yellen's testimony is likely to be in the spotlight on Wednesday, although trading could also be impacted by reaction to the results of the Treasury's auction of $23 billion worth of ten-year notes.