Foreign Buyers Jump Into Mediocre, Tailing 5-Year Auction

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While nowhere near as impressive as yesterday’s 2Y auction, today’s sale of $34 billion in 5Y Notes was good, if toward average. 5-year note auction went off without any difficulties with metrics that were generally close to average.

The high yield stopped at 2.434% a 0.4bps tail to the 2.430% When Issued, 20bps higher than last month’s 2.23%, and the highest since April 2010. The bid to cover of 2.48 was higher than December’s 2.36 if right on top of the 6 month average of 2.49%, with total bids of $89.4b for $39.0b in notes sold vs six previous auction average of $87.3b in bids for $36.6b in notes sold.

Similarly, the buyside takedown figures were in line with the average: there was a 65.0% Indirect takedown, well above December’s 58.4%, but in line with the 6 month average of 65.4%. Direct bidders took down 9.1%, just below the 6 month average 9.5%, leaving 26% to Direct bidders.

Overall, an unremarkable sale with nothing to write home about; perhaps the only notable feature is that in light of today’s broad selloff across the curve it could have been far worse.