Chillin' out till it needs to be funded
After an impaired Bid cover ratio of 2.86 in October ( 2.86 times bidders value as auctioned amount) and worse 2.54 in November, this month the sensitive 10 year treasuries left the immediate worries of downgrades behind them with a 3.53 cover ratio on a high $21bln raised by the Department of the Treasury. That’s another auction another day and the best bid cover ratio for the second successive time after the 3 Y bids yesterday
Dealers bought only 30% that means Investors were more than willing to forego the pain of yonder and come back to the US roof for long term holdings of Treasuries. China had been a regular buyer of US Treasuries since 2001 but has qound down its buyin recently after a consistently increasing buying pattern till 2008 and then again till earlier this year.
The October auctions had also taken yield to 2.27% while this month yields have come down to 2.02% in the auction