10 Year US Paper Prices In Subpar Auction

Tyler Durden's picture

Moments ago the Treasury priced it latest monthly issuance of 10 Year bonds in the form of a $21 billion reopening of one of the Fed's favorite CUSIPs to monetize, the 912828UN8 first auctioned off in February. The auction was hardly stellar, with the yield closing at 1.795%, tailing the When Issued of 1.790% by half a basis point. The Bid to Cover was also rather weak at 2.79, well below March's 3.19, and under the TTM average of 2.96%. Yet for all the complaining by the Dealer community, they ended up taking down 33.6% of the auction, with $40.8 billion in bids tendered, a 17.3% hit rate, and well above the 22.3% take down in March. The direct took down a sizable 29.1%, above the TTM average of 21.6%, leaving 37.3% to the Indirects, precisely as much as they had been allotted in the average auction during the past year. Still, hardly was the auction the disaster that Goldman's downgrade of the 10 Year point on the curve would have made it seem earlier today.

Finally, with just the 30 Year auction left for tomorrow, the total increase in US debt net of maturities now that the US is pretty much permanently without a debt ceiling, will amount to $6.7 billion, sending total Federal debt to about $190 billion away from $17 trillion.