Solid 20Y Auction Stops Through With Above Average Foreign Demand

The week’s lone coupon auction priced at 1pm when the Treasury sold $13 BN in 20Y paper, in a solid if not stellar auction.

The auction stopped at a high yield of 4.883%, up from 4.817% in March and the highest since last July. It also stopped through the 4.892% When Issued by 0.9bps, the highest since January.

The bid to cover was 2.68, down from 2.76 in March but above the 2.63 six-auction average.

The internals were also solid with Indirects taking 67.4% of the auction, down modestly from 69.2% last month but also above the 62.9% recent average for foreign buyers. And with Directs taking 22.9%, up modestly from 21.6% last month, Dealers were left holding just 9.7%, down from the recent average of 11.2%.

Overall, this was another solid auction, which is a welcome outcome at a time when 10Y yields are trading near weekly highs just around 4.30%.