Yields on two-year Treasury notes rose in Tuesday's auction to the highest level in more than two years.
The yield was 2.945 percent, up from 2.590 percent at the last auction on Oct. 27. It was the highest rate since two-year notes sold for 2.970 percent on June 28, 2002.
The notes will carry a coupon interest rate of 2 7/8 percent with each $10,000 in face value selling for $9,986.50.
A total of $24 billion in notes were sold out of bids totaling $62.6 billion.