The U.S. Treasury will auction off $58 billion of 3-year notes at the top of the hour. The components of the auction compared to their six-month averages, will determine success or failure.
- Bid to cover six-month average is 2.57X
- Tail six-month average is 0.0 basis points
- Directs (a measure of domestic demand) six-month average is 18.5%
- Indirects (a measure of international demand) six-month average is 65.0%
- Dealers six-month average is 16.5%
The high yield at the last auction came in at 4.399%. The current 3-year yield is at 3.829% after the sharp fall on the back of expectations for lower US growth and the expectations for the Fed to start to ease credit conditions in September.
