The US treasuries $36 billion auction of 10 year notes came in with:
- High yield 1.723%
- Tail +0.3 basis points
- WI yield 1.720%
- Bid to cover 2.51X versus 2.5x
- Dealers 16.61% vs 13.5%
- Directs 17.86% versus 16.1%
- Indirects 63.5% versus 70.5%
Auction Grade: C-
- The yield of the 10 year came down from about 1.800% yesterday to the auction yield of 1.723% today. So there was some buying into the supply. However, the yield was still up some 21 basis points from last month auction.
- The bid the cover was spot on to the 6-month average.
- The domestic demand as represented by the Direct bid percentage was higher than the average
- The international demand was much worse however.
- As a result the dealers were saddled with more than usual of the issue.
Not all that great but not a total disaster either.
PS Rick Santelli on CNBC concurred and gave the same grade.
10 year note auction grade: C-
