3 Month Bill Closes At 0.125%, 6 Month At 0.185%, Direct Bidders Take Down Over 14% In Both Auctions

Tyler Durden's picture

The $26 billion 3 month Bill closed at 0.125% with 92.53% allocation on the high yield. WI last traded at 0.135% at 11:30 am. The $28 billion 6 month Bill closed at 0.185% with 12.03 allotted at high. WI last traded at 0.195% at the time of auction. Both auctions were very well bid, pricing inside of the WI price at 11:30am, and Bid to Covers both well over historical averages and the prior auctions. Direct bidders were once again a major component of the take down, coming at over 14% for both auctions.

3 Month observations:

  • Median rate 0.10%, low rate at 0.07%, 92.53% allotted at high yield of 0.125%
  • Bid to cover 4.42, compared to 4.04 prior and 4.03 average in prior year
  • Indirect bidders take down 38%
  • Indirect hit ratio at 76.8%
  • Direct bidder take down 14.2%

6 Month observations:

  • Median rate 0.17%, low rate at 0.10%, 12.03% allotted at high yield of 0.185%
  • Bid to cover 4.44, compared to 4.29 prior and 3.90 average in prior year
  • Indirect bidders take down 38%
  • Indirect hit ratio at 50.5%
  • Direct bidder take down 14.0%


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IveBeenHad's picture

looks like contradicting auctions w/ the tail on the 3 month and allocation at high looking grim but promising on the 6 month. 


either way demand was strong but bidders not convinced about the low interest rate timeline for the fed seemingly. 

Anonymous's picture

Help me out here. Can't the Fed monitize the debt by getting the world's central bankers (or anyone else including GS or hedge fund managers for that matter) to purchase Treasuries by means of swaps for FRNs? As long as the Feds actions are opaque, what is the use in knowing whether bids are direct or indirect?

truont's picture

+1.  We have a winner!  What has he won today, Bob?

MarketTruth's picture

Actually the USA Congress can Constitutionally finance their own debt, thus eliminating the Federal Reserve and also the massive interest payments that accrue over time that is paid to their member that include the Rothschilds, Morgans, Rockefellers, etc. There is no need to use the Federal Reserve for debt whatsoever.

So that begs the question why Congress is allowing the Federal Reserve to hold such auctions and then have the USA taxpayer pay back BILLIONs of dollars in interest. If you can answer that, then you know more than most.

edwardscpa's picture

Does the Fed not refund net income from operations (including interest) back to the Treasury?  If you watch something like Zeitgeist, you'd be led to believe that the banking cabal is charging the US interest on every dollar in circulation.


I'd like to see Zero Hedge do a write up that breaks down the financial operations of the Fed.  Interest received, interest paid to Treasury, and "dividends" paid to member banks (and the basis for that calculation), etc.

Anonymous's picture

The Fed does in fact refund interest, a paltry sum compared to the losses dumped on treasury in MBS, Maiden Lane 1-2-3 and a huge pile of misc stink.

edwardscpa's picture

Granted, but there's a difference between private interests funneling losses through to the Treasury and straight income from seigniorage being paid directly to the Rothschilds, et al.

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