10-year Treasury yield backs off from 24-year high after solid bond auction eases demand fears– www.cnbc.com
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EXCERPT:
U.S. Treasury yields came off their highs after a solid sale of 10-year notes. Earlier, the 10-year yield rose to its highest level in more than two decades.
The 10-year Treasury last traded around 3 basis points higher at 5.288%. Earlier in the session, it reached 5.35%, its highest level since 2002. The 30-year Treasury bond yield also traded below a 24-year high, at 5.67%.
One basis point equals 0.01%, and yields and prices move in opposite directions.
The Treasury sold $39 billion of 10-year notes in an auction on Wednesday. According to BMO, the sale was “strong”, with higher than average bidding from non-dealers.
Indirect bidders, which include global central banks, took 80.3% of the auction — above a 10-auction average of 72.4%. Direct bidders, scooped up 17.1% of the sale, just below an average of 18.3%. Dealers, meanwhile, bought just 2.5% of the notes offered, well below a 9.4% mean.
“The 24-year highs in rates brought out the buyers and resulted in a great auction,” said Peter Boockvar, market strategist and author of The Boock Report.
Nonetheless, it still was the highest auction yield since 2000 at 5.3%.
