Details of the recent 30 year auction trends
The U.S. Treasury will auction off the $27 billion of 30 year bonds at the top of the hour. Yesterday the 10 year auction went off without a hitch. In fact it was one of the strongest auctions in recent memory with a tale over -3 basis points with indirect bids near 71% reflective of strong overseas demand.
Today's auction - like yesterday's - will be based upon recent auction trends over the last six months. Some of the components of those auctions show:
- Bid to cover, 2.27X
- Direct (a proxy for domestic demand), 19.0%
- Indirects (a proxy for international demand, 61.2%
- Dealers (the leftovers go to the Dealers) 19.8%
at the last auction, the high yield came in at 2.0% with a tail of 2.4BPS above the WI level at the time of the auction. The 30 year yield is currently modestly above 2.00% level at 2.019%.
