Preview $62B 7Y Note Auction

Final leg of early week's note supply, latest 7Y note (91282CCE9) auction is the fifth consecutive offering at $62B, up from $59B in December.

• Performance of the 7Y auction continues to lag all other Tsy offerings: averaging -1.3p tail over the last five months. The 7Y yield currently running around 1.282% vs. last month's auction high yield of 1.306% that tailed slightly vs. 1.305% WI.
• Bid-to-covers have averaged around 2.24x over the last 5 months, with April at 2.31x while Feb holds low of 2.04x.
• Indirect take-up of 57.05% and 57.21% last two months are better than the 5 month average of 55.35% -- only because the Feb auction take-up was so poor at 39.80%. Otherwise indirects averaged in the mid-60%. Primary dealer take-up only 22.32% last month vs. 25.83% 5M avg, while direct take-up bounced to 20.59% vs. 17.99% in March (compares to 18.79% 5M avg).
• The next 7Y auction is tentatively scheduled for June 24.
• Timing: The 7Y note results will be available shortly after the competitive auctions closes at 1300ET