Treasury 30-Year Bond Auction Clears 5.058% in B- Result
The $22B 30-year auction drew heavy foreign buying but domestic demand collapsed to half its usual share.
The Treasury just wrapped up the week's coupon supply by selling $22 billion in 30-year bonds at a high yield of 5.058%, stopping through the when-issued level of 5.061% by 0.3 basis points. On paper that stop-through looks clean. Don't let it fool you.
The headline bid-to-cover of 2.44x barely nudged past the six-auction average of 2.43x — basically a coin flip. The tail was negative, which is technically a win, but it's right in line with the recent average of -0.2 bps. Nothing to brag about there.
Read more Renewable Energy Dominates New Grid Capacity at 90 Percent →
Here's where it gets interesting: foreign buyers — the indirects — scooped up nearly 78% of the auction, way above their 65% average. That sounds bullish until you flip it over and see that domestic direct bidders took only 12.24% versus their normal 24%. American money sat this one out. International buyers had to carry the whole show.
Dealer takedown came in at 10.05%, just under the 10.9% average, so the Street didn't get stuck holding the bag. That's a mild positive. But the lopsided buyer composition — foreigners in, Americans out — is a yellow flag worth watching, especially as trade tensions keep rattling confidence in U.S. assets.
Forexlive grades it a B-. Rick Santelli called it an A- on CNBC. The honest read lands somewhere in B- to C+ territory. Demand was there, but the domestic side of the ledger was a no-show. Continue reading at Forexlive.
