Impressive 30Y Auction With Near Record-High Directs Keeps 10Y Yield At 4.00%

After two stellar, near-record coupon auctions earlier this week, including one of the best ever 3Y auction on Tuesday, and a similarly strong 10Y yesterday, moments ago the Treasury concluded the week’s auction when it sold $22 billion in 30Y paper in what was again another remarkably strong auction.

Today’s 30Y sale stopped at a high yield of 4.651%, down from 4.813% last month and the lowest since March; it also priced “on the screws” with the 4.651% When Issued, following last month’s badly tailing auction.

The bid to cover rose to 2.376 from 2.266, a fraction above the 2.366 six-auction average. 

The internals were solid with Foreign buyers taking down 62.03%, up from 59.52% and the highest since June. It was also above the recent average of 60.9%. And with Directs jumping to 28.01% from 23.03% and the highest going back all the way back to October 2011, or right after the first US downgrade…

… Dealers were left with just 10.0%, the lowest since June 2023.

Overall, this was a strong, if not quite stellar auction similar to the 3 and 10Y offerings earlier this week, but then again it didn’t have to be: the 10Y already dipped briefly below 4.00% earlier today on expectations of a potential jumbo rate cut next week, and the strong 30Y only helped push yields back to session lows.