Treasury Market Whipsaw: 2-Year Auction Hits Weakest Demand Since May 2024, Then Yields Reverse on Iran Ceasefire Hopes
A $69B 2-year Treasury auction on March 24 drew a 2.44 bid-to-cover ratio — the weakest since May 2024 — as the 10-year yield surged to 4.39% (highest since July 2025) on Middle East oil shock inflation fears. The next day, yields reversed sharply: the 10-year fell 6+ bps to 4.324% and the 2-year dropped 5+ bps to 3.879% after reports of a U.S.-proposed 15-point Iran peace plan sent Brent crude down 4% to ~$100/barrel. The 3-month T-bill rate held relatively stable at 3.63%.