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Preview 1/2: 3-year Note Auction


The early $58B 3Y note auction today has a size consistent with the previous three auctions after the US Treasury increased the offering by $2B to $58B in January. Last month's auction saw a trade-through of 0.2bp.

  • The March auction bid-to-cover was very strong at 2.69x, the highest at a 3-year auction since June 2018. This was largely due to an increase in the indirect bid-to-cover which came in at 1.77x (it had averaged 1.30x across the five prior auctions).
  • In spite of this, the share of the auction taken by indirect bidders was the lowest since November at 47.7% (down almost 5ppt from 52.6% in February). Direct bidders and primary dealers shared the extra take-up between them.
  • The 3Y yield is currently running around 0.33% vs. last month's 3Y auction (91282CBR1) that drew 0.355% high yield vs. 0.357% WI.
  • The next 3Y auction is tentatively scheduled for May 11
  • Timing: The 3Y note will be auctioned alongside the 26W bill with results available shortly after the competitive auctions close at 11:30ET/16:30BST.

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