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Bid To Cover Plunges To 6 Year Low, Indirects Slide In Weak 3-Year Auction
On the surface, the just concluded auction of $24 billion in 3 Year paper was solid: printing at a high yield of 1.271% (22.93% allotted) while highest since April 2011, this priced 0.4 bps though the When Issued of 1.275%.
The good news ended there, because while the Direct Bidders took down 15.1% of the auction, or the highest since last November, it was the big drop in Indirects to 40.8% (down from 47.7%) and the lowest since November 2014, offset by a jump in Primary Dealers, that signalled not all is well.
But the worst was the plunge in the Bid to Cover, which after printing at a reasonable 3.14 a month ago, dropped to a paltry 2.82 in November, not only far below the TTM average of 3.27, but the lowest since October of 2009 when it hit 2.76 however in a rising trend.
In short: end demand far weaker, saved by Primary Dealers, as suddenly foreign central banks are far less interested in US paper just at a time when yields are rising and purchases of said paper that much more attractive.
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In other news...Krugman is a piece of shit
Any not just any piece of shit. He's one of those foul, dark, dry, smelly, hard-to-pass pieces of shit.
Just call him Captain Constipation, hero to the brain damaged everywhere.......
"...as suddenly foreign central banks are far less interested in US paper..."
This will become a very common statement in the future.
Moar QE or else JPM will have to spend all their money keeping the ponzi alive.
The stock bubble is nothing next to the bond bubble.
"In short: end demand far weaker, saved by Primary Dealers"
Time for the government to initiate their plans to sell Treasurys directly to the unsuspecting citizens...
https://roguelibrary.com/
Hope you guys enjoy. Took a lot of inspiration from ZH for this novel, which deals with the current financial crisis, cryptocurrencies, anarchy, Austrian economics, central banking, etc.