Treasury 3-year auction preview: the $24 B auction could be difficult
Treasury 3-year auction preview: the $24 B auction could be difficult given the concentration of auctions this week, including $138 B in bills yesterday and the $44 B on tap today including this afternoon's 10-year sale. The offering should benefit from it's cheaper absolute level where the wi is at 1.050%, which would be the highest stop since January, when Fed rate hike fears were also endemic. The note is also cheap on the curve, with the 2s-3s gap the widest since late May. The carry and roll are also attractive. However, hurdles will be the generally bearish bent in bond markets as not only Fed tightening fears are increasing, but there are growing concerns that the stimulus spigot is being turned down at the ECB, BoJ, and BoE. The note is also not that special in the repo market.