The U.S. Treasury's sale of $22 billion in 30-year bonds was met with robust investor interest, resulting in a high-yield auction at 5.058%, the highest level seen since 2007. The pre-auction trading yield at the 1 p.m. New York deadline was 5.061%, indicating that final demand exceeded market expectations. Following the auction results, the 30-year Treasury yield edged slightly lower, having already declined by approximately 1.5 basis points by the bidding cutoff.
Primary dealers were allocated 10% of the offering, marking their smallest share since March. Indirect bidders, a category that includes foreign central banks, saw their allocation jump to 77.7%, placing it among the highest historical levels. Direct bidders received 12.2%, their lowest allocation in over a year.
The bid-to-cover ratio, a key gauge of demand, came in at 2.44 times the securities on offer. This compares favorably to an average ratio of 2.39 times for the preceding six auctions of a similar nature.
Comments