The US Treasury to break the monotony with the auction of $32B of 10 year notes

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The US treasury will break the monotony of the day with the auction of the $32B of 10 year note at the top of the hour.

To be fair, the markets are waiting in anticipation for the CPI data tomorrow, and that is helping to contribute to the sideways trading in most of the major currency pairs today.

Nevertheless, will the forthcoming CPI impact the demand for the 10 year note today?

The six-month averages of the major components will help to determine the overall demand. Those component pieces shows:

  • bid to cover, 2.35X
  • Tail, 2.0 basis points
  • Directs (a measure of domestic demand) 18.6%
  • Indirects (a measure of international demand) 62.0%
  • Dealers (they are stuck with the residual) 19.4%

At the last auction the high yield came in at 3.625%. The current 10 year note is trading at 3.581%.

US stocks ahead of the auction are down to solid gains:

  • Dow Industrial Average up 127.15 points or 0.38% at 33830.10
  • S&P index up 37.6 points or 0.70% at 3946.74
  • NASDAQ index up 120.24.2 or 1.12% at 10862.56

This article was written by Greg Michalowski at