Solid Demand For 3Y Auction Leads To Biggest Stop Through Since February
In a day when stocks first surged, then wobbled, and are once again ramping higher as the odds of a government reopening are jumping, bonds today's were relegated to page 6 but that doesn't mean that demand for paper wasn't there: as the just concluded auction of $58BN in 3Y paper showed, demand for the short-end is strong as ever.
The auction stopped at a high yield of 3.579%, up fractionally from 3.576% last month. And like last month, today's auction stopped through the When Issued by 1 basis point, the third stopping auction in a row, and the biggest stop through since February 25.
The bid to cover rose to 2.850 from 2.663 in October, above the recent average of 2.583, and was the highest since August '23.
The internals were also solid, as Indirects were almost unchanged at 62.96 (vs 62.70 last month), and above the 62.36 recent average. And with Directs rising to 27.32% of the auction, up from 26.58% last month and the highest since August, Dealers were left with only 9.7%, down from 10.7% in October and below the 13.8 recent average.
Overall, a very solid auction and yield across the curve understandably dipped in the secondary market once it priced.
Tyler Durden
Mon, 11/10/2025 – 13:21