Treasury 30-Year Bonds May Yield 4.610% at $13 Billion Sale, Survey Shows
The Treasury Department’s $13 billion sale of 30-year bonds may draw a yield of 4.610 percent, according to the average forecast in a Bloomberg News survey of 7 of the Federal Reserve’s 20 primary dealers.
The offering is a reopening of the $16 billion auction of long bonds on Feb. 10, and the securities mature in February 2041. They yielded 4.625 percent in pre-auction trading. Bids are due by 1 p.m. New York time.
Last month’s sale of 30-year bonds drew a yield of 4.75 percent, compared with 4.515 percent at the January auction. The February offering’s bid-to-cover ratio, which gauges demand by comparing the amount bid with the amount offered, was 2.51, versus 2.67 at the January sale of the securities and an average of 2.66 for the past 10 auctions.
Indirect bidders, a class of investors that includes foreign central banks, bought 43.1 percent of the bonds at the February sale and 37.8 percent at the January sale. The average for the past 10 auctions is 38.9 percent.
Direct bidders, non-primary-dealer investors that place their bids directly with the Treasury, purchased 8 percent of the securities at the last sale, compared with 12.4 percent in January and an average of 13.4 percent at the past 10 auctions.
Thirty-year bonds have lost investors 3.4 percent this year, trailing the 0.3 percent loss for Treasuries overall, according to Bank of America Merrill Lynch indexes.
The Fed’s primary dealers trade government securities with the central bank and are obligated to participate in Treasury auctions.
The U.S. is selling $66 billion in notes and bonds this week. It auctioned $32 billion of three-year debt on March 8 at a yield of 1.298 percent. It sold $21 billion of 10-year securities yesterday at a yield of 3.499 percent, drawing the highest bid-to-cover ratio, 3.32, since April.
To contact the reporter on this story: Susanne Walker in New York at swalker33@bloomberg.net
To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net
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