NEW YORK: The US Treasury's auction of $38 billion worth of new three-year notes was met with strong demand on Tuesday, as indirect bidders took the largest portion of the offering since December 2017.

The bid-to-cover ratio for Tuesday's offering, an indication of overall demand, was 2.62 - the highest since September 2018. Indirect bidders, a proxy for foreign buyers, took 56.6% of the supply, while direct bidders took 13.37% and primary dealers took 30.02%.

The three-year note yield dipped immediately following the auction as prices rose, retracing its rise earlier on Tuesday. It was last up 0.8 basis point at 1.879%.