Treasury's $7 B 30-year TIPS reopening was well received
Treasury's $7 B 30-year TIPS reopening was well received. The inflation index securities have garnered ok to lukewarm demand most of this year given weaker inflation expectations. However, there been solid buying from overseas accounts. The offering was awarded at 0.501%, through the 0.529% at the bid deadline. And it compares to the 1.093% for the $8 B new issue in February. The breakeven of 159 bps is one of the lowest since June 2016. There were $18.9 B in bids for a 2.70 cover, better than the 2.46 from February, though today's sale was flattered a bit by the smaller reopening size. Indirect bidders were awarded 81.6%, marginally smaller than the prior 82.0%, which was a record high. In fact, in the history of the 30-year TIPS there have only been three offerings (including today's) with an indirect bid at or above 80%, and all three have been within the last 14 months.