U.S. Treasury auctions off $42 billion up 10 year note
high-yield 4.255% WI level at the time of the auction 4.244%Bid to cover: 2.35X vs 2.58X six month averageDirects (domestic buyers): 19.61% vs 16.4% six month averageIndirects (international buyers): 64.23% vs 72.3% six month averageDealers: 16.16% vs 11.2% six month average
AUCTION GRADE: D
It wasn’t a total failure but the auction stunk. The bid to cover was low, the tail was high relative to the WI level at the time of the auction (and history). The international demand was low. The domestic demand was okay but it seems the domestic demand is being influenced by things like stablecoin demand. The dealers were saddled with a big amount at 16.6% well above the average of 11.2%.
The auction stunk.
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This article was written by Greg Michalowski at investinglive.com.