Treasury bond yields tumble as investors seek havens

This article was originally on a blog post platform and may be missing photos, graphics or links. See About archive blog posts.

Some investors rushed into U.S. government bonds on Tuesday -- the usual knee-jerk reaction to the kind of geopolitical upheaval slamming the Middle East.

That’s a good sign for people who count on their Treasury securities to provide a little portfolio insurance in times like these.

It’s also helping save U.S. taxpayers some interest expense, as the Treasury this week sells a total of $99 billion in two-, five- and seven-year securities to finance the federal deficit.

The Treasury on Tuesday auctioned $35 billion of two-year notes and paid an annualized yield of 0.745%. A week ago two-year Treasury notes were yielding 0.82% in the market.

Yields fell sharply on other Treasury issues as well as buyers poured in. The five-year T-note slid to 2.15% from 2.27% on Friday (markets were closed Monday for Presidents Day).

The 10-year T-note yield, a benchmark for mortgage rates, fell to 3.47% from 3.58% on Friday.

The Treasury will sell $35 billion of five-year notes on Wednesday and $29 billion of seven-year notes on Thursday.

-- Tom Petruno