Question about increasing treasuries yield

H

huab1992

When the yield of the treasury issues at auction with higher yield than the on-the-run treasury, does this also means increasing of the yield (I mean like in the news when they say the yield increased..)
 
If yield of new Treasury bonds is higher than previously issued ones, then yield on previously existing ones will have also gone up via the prices of those previous ones having decreased, such price decrease to be borne by the holder of course.
 
SoyUnGanador said:
If yield of new Treasury bonds is higher than previously issued ones, then yield on previously existing ones will have also gone up via the prices of those previous ones having decreased, such price decrease to be borne by the holder of course.
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"the prices of those previous ones having decreased" .. why/what causes the decrease? is it the buy/sell demand...
 
huab1992 said:
"the prices of those previous ones having decreased" .. why/what causes the decrease? is it the buy/sell demand...
More...


Yes, who is willing to buy a bond yielding 3% when new ones yield 4%? The old ones will trade at like 75% of their face amount so that their yield is also 40%, meaning holders of the 3% bonds have lost 25 cents on the dollar.
 
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