Demand was unexpectedly strong in a 7-year Treasury auction, perhaps as Japanese firms begin to shift asset allocations. At this point it’s too early to say with any certainty.
The WI bid was 1.162% ahead of the sale and it sold for 1.155% and that sent a bit of jolt through the rest of the Treasury curve. The bid-to-cover was also strong at 2.71 compared to 2.56 in March. The yield was the lowest since November.
