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Sunday, August 1, 2021

US treasury auctions of $24 billion of 20 year notes at a high yield of 2.12%

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WI 2.137% at the time of the auction

  • High yield versus a WI yield of 2.137. Tail of 1.7 basis points
  • Dealers 17.53% versus six month average of 24.5%
  • bid to cover 2.4x vs six month average of 2.33X
  • Indirects 62.1% vs 58.0% six month average
  • Directs 20.4% versus 17.5% six month average

Auction Grade: A+

The auction was near-perfect with a 

  • tail of -1.7% vs the WI auction yield of 2.137. 
  • The dealers were saddled with only 17.53% (vs six month average of 24.5%). 
  • Foreign demand was strong at 62.1% versus 58.0% average.  
  • The domestic demand from the Direct bid was also comfortably above the six month average

There is nothing wrong with the auction ahead of the FOMC rate decision tomorrow.  

Meanwhile stocks remain more under pressure with the NASDAQ index now down -100 points or -0.71% at 14074.30. The S&P index is down -10.5 points or -0.25% at 4244.80. 

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