Bond Traders Haven't Been So Leery of U.S. Auctions Since the Crisis
- Bid-to-cover ratio for 10-year Treasuries is lowest since ’09
- With deficits set to balloon, debt demand may get even weaker
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Add one more thing to the list of worries for the world’s most indebted nation: weakening demand at its bond auctions.
While there’s no danger of the U.S. being unable to borrow as much as it needs, over the past two years, the drop-off has been unmistakable. Based on the number of bids that investors submitted versus the actual amount sold, average demand for 10-year notes has fallen to the lowest since October 2009.