Traders noted the $13B 2Y FRN........>

US TSYS/SUPPLY: Traders noted the $13B 2Y FRN reopening had a 3.46 bid/cover, a

sign of strength amid mixed results. That is the strongest bid/cover since 3.46

cover of August 2016.

- Jefferies economist Tom Simons said the "2-year FRN reopening stopped at a

discount margin (DM) of +5.5 bps, which is 1/2 bps short of where the WI was bid

at 11:30AM. This was a solid auction from a pricing perspective, but the Dealer

takedown is relatively heavy. So, it is somewhat difficult to make a real

judgement."

- He adds that "since November 2015, the June 2016 and May 2017 auctions are the

only ones to have tailed (not counting the stops on the screws in February and

today). The 3.46 bid cover is the highest since December 2016. Indirect bidders

took down 47.1% which is their weakest takedown since May. Direct bidders took

down 0.0%. They are often non-factors in these auctions and today was no

exception. Their $1.6 bln total bid completely missed.

-The 52.9% Dealer takedown is the highest since May."