Yields on 3-Year Notes Highest Since November

Yields on three-year Treasury notes rose in Tuesday’s auction to the highest level since November.

The average yield was 8.23%, up from 7.42% at the last auction on Feb. 1.

It was the highest rate since three-year notes averaged 8.74% on Nov. 19. The notes will carry a coupon interest rate of 8.125%, with each $10,000 in face value selling for $9,972.50.

A total of $8.76 billion in notes was sold out of bids totaling $25.9 billion.

The Treasury said it would consider the three-year notes to be an extension of the March, 1986, issue of five-year, two-month notes because the coupon rate of 8.125% is the same for both.

The sale was the first part of the Treasury’s $26-billion refunding this week. The government plans to auction $8.75 billion in 10-year notes today and $8.5 billion in 30-year bonds Thursday. Both will have minimum denominations of $1,000.