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A Rare Strong 20Y Auction

US TSYS/SUPPLY
  • 20s rally further but quickly pare some of the move - having rallied 1.5bp in the 15mins ahead of the auction, they currently sit another 1bps lower again.
  • The 20Y auction stopped through by 2bps (high yield 4.542% vs WI 4.562%), its first stop since Nov after a particularly large 3.3bp tail and a five-auction average tail of 0.7bp.
  • Strong internals with highest bid-to-cover since Jun, lowest dealer take since Sep and highest indirects since Nov.
  • Bid-to-cover: 2.79x after 2.39x in Feb (five-auction average 2.53x).
  • Primary dealer: 9.35% after 21.2% in Feb (five-auction average 14.6%).
  • Indirects: 73.49% after 59.1% in Feb (five-auction average 66.9%).
  • Directs: 17.16% after 19.7% in Feb (five-auction average of 18.5%).

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