Treasuries held a two-day decline before the U.S. auctions as much as $32 billion of three-year government debt today. Treasuries returned 6.8 percent in the 12 months to yesterday, based on Bank of America Merrill Lynch data, reflecting demand for U.S. debt as a haven from slowing economic growth and Europe’s debt crisis. The rally was interrupted after an Aug. 3 report showed the nation added more jobs than economists estimated. The U.S. is scheduled to sell $32 billion of three-year notes today, $24 billion of 10-year debt tomorrow and $16 billion of 30-year bonds on Aug. 9. “I don’t expect the auctions this week will have any problems being placed in the market, especially in an environment where uncertainty is still very high,� said Michael Markovic, a fixed-income strategist at Credit Suisse Group AG (CSGN) in Zurich. Benchmark 10-year note yields were little changed at 1.58 percent at 8:58 a.m. London time, according to Bloomberg Bond Trader prices. They reached a record low 1.38 percent on July 25. The price of the 1.75 percent security due May 2022 was 101 17/32. The notes scheduled for sale today yielded 0.34 percent in pre-auction trading, versus 0.366 percent the last time they were sold, on July 10. Investors submitted orders to buy 3.52 times the amount of available debt last month. The average over for the past 10 sales is 3.49 times. Indirect bidders, which include foreign central banks, purchased 30 percent of the securities. Ebbing Demand Investor appetite for the safety of Treasuries ebbed this month when a U.S. employment report showed the nation added 163,000 jobs, versus 100,000 projected by economists surveyed by Bloomberg News. The Federal Reserve bought $2.3 trillion of mortgage and Treasury debt between 2008 and 2011 in two rounds of so-called quantitative easing to cap borrowing costs. It’s now in the process of swapping shorter-term Treasuries in its holdings with those due in six-to-30 years to lower long-term rates. The central bank is scheduled to buy as much as $5 billion of Treasuries due from August 2018 to May 2020 today as part of the program, according to the Fed Bank of New York website. The Fed said Aug. 1 it will inject fresh stimulus into the economy if necessary to boost growth and reduce an unemployment rate that has been stuck at 8 percent or higher for more than three years. To contact the reporters on this story: Wes Goodman in Singapore at wgoodman@bloomberg.net; Neal Armstrong in London at narmstrong8@bloomberg.net To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net

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