Jefferies economists Ward McCarthy and...>

US TSYS/7Y: Jefferies economists Ward McCarthy and Tom Simons noted Thursday's

1pm ET $28B 7-year note auction "is the same size as last month. The auction

will pay down $2.5 bln. We expect a SOMA add-on of approximately $3.7 bln."

- They added that the November 7-year note auction "came with the widest tail

since February 2016. Considering that the 2- and 5-year auctions this week were

met with tepid demand, a repeat performance may be in the cards today."

- They said "indirects took down a record-high 81.7% in April, but have been

closer to average in the past 7 auctions, generally hovering in the mid-60s. The

58.6% takedown in November was the worst since August 2016."

- They added the Direct takedowns "of the past 2 months have been at the low-end

of the range as well. The WI tends to close the day higher in yield than where

it was ahead of the auction, regardless of whether or not the auction tails or

stops short."