The two-year note yield was 6.21 percent, down from 6.25 percent.

The perception that the five-year note yield was attractive was manifested in trading following the auction.

The current 10-year note yield fell to 6.24 percent.

The two-year note yield is about a fourth of a percentage point higher than the recent average for overnight bank loans in the Federal funds market.

The two-year note yield broke below the key 6 percent level, which traders said showed that another Fed easing was fully expected.

A cut of a tenth of a percentage point in the note yield is equal to an annual savings of about $14 million for the Government.

The nation's two-year note yield was also little changed at 0.71pc.

The 10-year note yield rose to 4.11 percent from 3.81 percent a week earlier.

Two-year note yields fell five basis points, to 6.08 percent.

In London, the 10-year note yield fell to 6.88 percent, from 6.90 percent Friday.