Treasury's $24 B 10-year note reopening was rather lackluster
Treasury's $24 B 10-year note reopening was rather lackluster, but ok. On the disappointing side, the auction tailed and bidding was moderate given still relatively rich pricing. On the other hand, the stats were a little better than those of August and May, but those were some of the worst in years. The auction stopped at 1.739% after richening into the bid deadline to 1.736%. It's about 7 bps cheaper than the 1.670% award rate for the $27 B new issue in August, and excluding that rate, this is the richest award since September 2016. However, the coupon remains at 1.625%. There were $59.1 B in bids for a 2.46 cover, an improvement over the poor 2.20 last month (which was the second lowest since March 2009), as well as the 2.43 average. Indirect bidders accepted 62.6%, also better than the prior month's 55.7% (which was the second lowest since April 2018) and in line with the 62.9% average. Direct bidders took 12.7%, fractionally less than last month's 13.6%, and slightly stronger than the 11.4% average. Primary dealers were awarded 24.7%, below both the 30.7% previously and the 25.7% average. In fact, it's at the lower end of the spectrum, and is a relatively good sign as the paper is in stronger hands.