Traders projected the 1pm ET $14B 5Y...>

US TSYS/TIPS: Traders projected the 1pm ET $14B 5Y TIPS reopening auction will

get done at about 0.405% rate. 

Some traders expected moderately good demand. "I think it will be okay," said

one trader. "I have no reason to think it will be gangbusters. We have backed up

in real yield. We're at highest since early 2016 in real yields. But we are not

at the breakeven highs."

- BMO's Aaron Kohli expects a "stop close to the screws" as 5Y reopening

auction's "liquidity provision," and "tax cut optimism and high real yld levels

offset rich breakevens, stretched crude positions and a hawkish Fed. 

- HISTORY: Aug. 5Y TIPS reopening drew 0.117% high yield, 2.41 bid/cover, 65.5%

indirects, 11.6% directs, leaving only 22.8% for primary dealers to mop up.