U.S. 30-Year Treasury Auction Draws Weaker Demand; High Yield at 5.441%

Demand weakened at a U.S. 30-year Treasury auction, with the high yield coming in above the when-issued yield, a sign that investors sought slightly more compensation to buy the bonds. The bid-to-cover ratio also declined from the previous auction.

Cointelegraph reported on November 12 that the high yield at the U.S. 30-year Treasury auction was 5.441%, 0.4 basis point above the 5.437% when-issued yield. It was lower than the 5.618% high yield at the previous auction.

The bid-to-cover ratio, a gauge of demand, fell to 2.36 from 2.54 at the prior auction.

The share awarded to indirect bidders, which include foreign central banks, dropped to 68.1% from 72.3%. The share awarded to direct bidders also edged down to 20.5% from 20.9%.

Although the auction's high yield was lower than at the previous sale, the bid-to-cover ratio and allotment shares for key bidder groups both declined. The fact that the high yield came in above the when-issued yield suggests investors demanded a modest premium to buy the Treasuries.