Poor T-Bill Auctions Point to Investor Skepticism on Repo Market Calm
- U.S. sold 4-, 8-week debt at rates higher than pre-auction
- Market not confident repo to remain under 2%, Jefferies says
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The volatility in the repo market has abated for now, but if Thursday’s Treasury bill auctions are any indication, investors are skeptical that this will last.
The Treasury sold $45 billion of four-week bills and $40 billion of eight-week bills at 1.95%. The when-issued level for the four-week security was trading at 1.90% a few hours before the sale, and the eight-week traded as low as 1.885%, according to Jefferies.