HERE COMES THE BIG 30-YEAR TREASURY AUCTION THAT EVERYONE IS WATCHING

Heads up! We’re minutes away from the results of today’s primary market auction of 30-year Treasury bonds, due out at 1 PM ET.

This week, other government auctions for shorter-dated Treasuries have produced lackluster results.

Demand for the 10-year U.S. Treasury note, proxied by the bid-to-cover ratio (which measures the dollar amount of bids versus the dollar amount of bonds actually auctioned), fell to its lowest level in 10 months at yesterday’s auction.

Because of the poor performance earlier this week, some observers are predicting a “tail” at today’s long bond auction.

(The “tail” is the difference between the highest yield on the Treasuries during the auction and the yield when the auction first gets started – the “when-issued” level. Thus, the appearance of a “tail” typically represents weak demand).

Yesterday’s auction of 10-year notes finished “on the screws,” which means the highest yield matched the when-issued level. So, no tail.

Given all of the volatility in the Treasury market in recent weeks, driven by fears of Fed tapering, the results of today’s auction will be important to watch.

We will have the results LIVE at 1 PM. Click here to refresh for the latest >

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.