Most U.S. government bond prices dropped Tuesday, after the Treasury managed to borrow from investors at the lowest rate in seven months, according to AP. The Treasury sold $32 billion in three-year notes Tuesday in the first of three auctions this week. The notes were priced to yield 0.76 percent, the lowest rate set at a three-year auction since last November. Investors placed bids for 3.28 times the $32 billion in three-year notes up for sale Tuesday. That's slightly better than the 3.18 average of the previous four auctions. Traders have rushed into Treasurys in recent weeks on signs the economic recovery was becoming sluggish. When bond prices rise, yields fall. That translates into lower borrowing rates for the government. Most Treasury prices dipped slightly Tuesday after making large gains last week. In late afternoon trading, the price of the 10-year Treasury note was down 15.6 cents for every $100 invested. The yield inched up to 3.02 percent from 3.01 percent late Monday. The 30-year bond was down 21.8 cents. Its yield rose to 4.27 percent from 4.25 percent. Short-term Treasury securities traded flat. The yield on the two-year slipped to 0.42 percent from 0.43 percent.
