The US Treasury sold $70 billion of five-year notes at a high yield of 4.408%, above the 4.399% when-issued level at the time of the auction. Direct bidders took a larger share than their average while indirect demand and the bid-to-cover ratio came in below theirs. investingLive graded the sale D+.
The US Treasury sold $70 billion of five-year notes at a high yield of 4.408%, above the 4.399% when-issued level at the time of the auction.
investingLive's Greg Michalowski graded the auction D+, adding that a softer grader would have called it a C-. By his tally, the tail and the bid-to-cover came in below average and indirect demand fell short, with direct bidding and dealer takedown running above.
The numbers behind that grade start with the tail. The sale priced at a tail of 0.9 basis points against a six-month average of 0.6 basis points. The overall bid-to-cover ratio came in at 2.28, against an average of 2.33.
Bidding then split across the three buyer groups. Direct bidders took 27.22% of the notes, against an average of 21.4%. Indirect bidders, by contrast, took 59.25% versus their 65.6% average.
That left dealers with 13.53% of the sale, above their 12.9% average — an outcome investingLive marked as a negative.
Source: investingLive
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