POMO Closes: $3.6 Billion In Debt Monetized, Morgan Stanley Predictive Prowess Still Spotless
Today's POMO has closed, with the Fed monetizing $3.609 billion in debt, far more than previously expected, and much more than last auction's $2.5 billion (is Liberty 33 sweating in its reliquification attempts courtesy of today's nightmarish economic date). The hit rate was also worse than the previous one, coming in at 16.5%, with 12.2% previously (another way of saying this is that the submitted/accepted ratio was 6.07). And yet again, Morgan Stanley was spotless, with its 9 bond predictions all eligible for purchases, and in fact seeing 6 of the 9 proposed issues purchased by the Fed. In a basket which had 27 eligible CUSIPs, this is quite an impressive result.
Below are the details of the bonds suggested by MS would be bought back:
- 3.25% of 3/31/2017 - eligible, $755 million monetized
- 3.125% of 1/31/2017 - eligible, $294 million monetized
- 3.25% of 12/31/2016 - eligible, $315 million monetized
- 2.75% of 11/30/2016 - eligible, $395 million monetized
- 3.125% of 4/30/2017 - eligible, $162 million monetized
- 2.75% of 5/31/2017 - eligible, $158 million monetized
- 3.125% of 10/31/2016 - eligible
- 3.0% of 9/30/2016 - eligible
- 2.375% of 7/31/2017 - eligible
Oddly enough, the biggest repurchased issue, the 3.0% of 2/28/2017 was not on MS' list. Nonetheless, this is truly a spectacular result for all who front-ran the fed based on Morgan Stanley's recommendation.
Those who are curious which issues will most likely be bought back at the next POMO day, on August 24, can see the 10 most eligible issues here.