Wednesday, September 8, 2010

10 Year Treasury is Still in Demand

Good news continues for the US Treasury, and the broader bond market, following today's ten year note auction. This information is found on Bloomberg today following the auction:

Buyside interest in the monthly 10-year auction was strong. Direct and indirect bidders took down a combined 62 percent of the auction, nearly 10 percentage points above average. At 3.21, coverage for the $21 billion reopening of the August issue was the strongest since June. The auction stopped out at 2.670 percent, nearly two basis points below the 1:00 ET bid. Money is moving into Treasuries following the results. Tomorrow the Treasury auctions $30 billion in 30-year bonds.

The chart below shows that the yields on the ten year note are trending lower. Only the December 2008 and January 2009 auctions have seen yields lower than todays auction.