US sells USD 13bln of 20-year bonds; stop-through 0.9bps
- High Yield: 4.883% (prev. 4.817%, six-auction avg. 4.723%); WI: 4.892%
- Tail: -0.9bps (prev. -0.7bps, six-auction avg. -0.1bps)
- Bid-to-Cover: 2.68x (prev. 2.76x, six-auction avg. 2.63x)
- Dealers: 9.7% (prev. 9.2%, six-auction avg. 11.2%)
- Directs: 22.9% (prev. 21.6%, six-auction avg. 25.9%)
- Indirects: 67.4% (prev. 69.2%, six-auction avg. 62.9%)
Context
The recent auction of 20-year bonds saw a higher yield than previous auctions, indicating rising borrowing costs. While the bid-to-cover ratio remained robust, the slight drop in demand from dealers suggests a waning appetite that could impact future issuance. Overall, the auction results may signal market concerns about rising rates and their implications for economic growth and fixed income valuations.
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