Treasury Action: supply heats up next week with $64 B in coupons
Treasury Action: supply heats up next week with $64 B in coupons hitting the auction block. The size of the package was increased by $2 B versus March's $62 B, thanks to the boost in the 3-year note. The debt managers will sell $30 B in 3-year notes (Tuesday), $21 B in reopened 10-year notes (Wednesday), and $13 B in reopened 30-year bonds (Thursday). They will also sell $90 B in 3- and 6-month bills on Monday. Short covering following the disappointing job gains has richened the Treasury market and knocked when issued (wi) yields markedly lower. The wi 3-year is down 3.5 bps to 2.425%, with the wi 10-year off over 4 bps to 2.815%, and the wi 30-year bond down nearly 4 bps to 3.060%. Recent auctions, especially the shorter dated offerings, have suffered from waning demand and any further richening may keep buyers sidelined too. However, safe haven demand and still wide spreads to foreign sovereigns could underpin.