Bond Market Update

Auction Reaction

• U.S. Treasuries have seen some recent buying with the long bond returning to its opening high while shorter tenors are a bit below their best levels of the session, though they too have advanced in recent trade. The uptick followed the completion of today's $22 bln 30-yr bond reopening, which met solid demand. The sale drew a high yield of 4.844%, which stopped through the when-issued yield by an impressive 1.5 basis points while the bid-to-cover ratio (2.43x) was above average (2.41x). Indirect takedown (62.5%), however, was a bit shy of average (65.5%). Altogether, this makes for an encouraging finish to this week's note and bond auction slate that started with a sloppy 3-yr note sale on Tuesday.
• Yield Check:
  • 2-yr: -4 bps to 3.90%
  • 3-yr: -5 bps to 3.86%
  • 5-yr: -5 bps to 3.96%
  • 10-yr: -6 bps to 4.35%
  • 30-yr: -7 bps to 4.84%