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Record Foreign Central Bank Demand Leads To Blistering 5 Year Auction
If yesterday's 3 Year auction was far stronger than expected, then today's 5 Year auction was an absolute whopper, printing moments ago at a high yield of 1.625%, 0.5bps through the When Issued, but it was the internals that were most impressive, not so much the Bid to Cover which jumped from 2.39 to 2.58, the highest since November, but the real stunner just like in yesterday 3Y auction, was the central bank, aka Indirect, interest because while the foreign central bank bid in yesterday's 3 Year auction were the highest since 2009, today's 67.5% Indirect takedown was the strongest on record!
And the biggest surprise: this is happening precisely one hour ahead of a potentially pre-hiking FOMC statement, usually a time when there is no violent expression of interest in the one instrument that would be whacked the most should the Fed indeed hike.
In other words, foreign central banks have made it very clear how they feel about the possibility of a Fed rate hike not only today, but for the rest of 2015.
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Greater Depression?
its almost like they know something we don't ... like GDP will be going lower & taking rates with them
sad to think that 2.285% on a 10-year and 2.99% on a 30-year is 'too high of interest'
like my grandfather has been saying "i feel bad for your generation ... your all going to be working for the banks soon enough"
too which i explain to him the concept/logistics of negative rates
This is the best toilet paper around, so buy a roll today.....
At least the central banks have money. /s
Quite the story line "printing moments ago..."
I like that - printing. No pun intended, right?
So the Fed is buying (using who this time?)
Someone has to soak up all the leaks now that China is adding to the flow.
When SHTF, like it is in China, buyers rush to USTs because they have been the staple of safety. Problem is, now that fiat currency has been inflated, they don't hold water. Watch a rush in before rates rise, which they will start to soon.
'BLICS'...?
The William Dudley buying via the BIS or is it just Belgium again?
US gave the EU $16 trillion to buy US sovereign debt.
Buying it with our own money.
LOLOL.
How much did China, Russia, and India buy?
The foreign central banks are buying US Military futures. The bet is that the US Military will be able to enforce settlement whne US T Bonds are converted to equity in US National Parks, and other US Gov't assets.