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Very Modest Tail On 3Y Note Sees Limited Reaction

US TSYS/SUPPLY
The slightest of tails on the 3Y auction: 0.2bp on 4.202% high yield vs Bloomberg's when-issued 4.200%.
  • Looking at the periphery stats, nothing remarkable:
    • Dealer takeup was pretty much exactly in line with the prior 5-auction average (16.74% today vs 16.94%) with indirects taking a slightly lower 61.53% vs 65.15% avg (albeit with a very high 73.4% in May which skewed the average higher).
    • Bid-cover at 2.70x slightly softer than May's 2.93x but again, last month was an outlier - the 5 auction average is 2.68x.
  • In keeping with the result, there was very modest weakness in the aftermath of the auction, with the tenor cheapening by <0.5bp. We move on to the 10Y re-open at 1300ET.

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