{"id":31817,"date":"2023-10-19T10:56:16","date_gmt":"2023-10-19T10:56:16","guid":{"rendered":"https:\/\/innodebt.com\/markets\/20-year-treasury-auction-shows-strong-demand-bond-buyers-see-opportunity\/"},"modified":"2023-10-19T10:56:18","modified_gmt":"2023-10-19T10:56:18","slug":"20-year-treasury-auction-shows-strong-demand-bond-buyers-see-opportunity","status":"publish","type":"post","link":"https:\/\/innodebt.com\/?p=31817","title":{"rendered":"20-Year Treasury Auction Shows Strong Demand. Bond Buyers See Opportunity."},"content":{"rendered":"<div id=\"js-article__body\" itemprop=\"articleBody\" data-sbid=\"WP-BAR-0000773393\">\n<div data-layout=\"wrap\n              \" data-layout-mobile=\"\" class=\"\n        media-object\n        type-InsetMediaIllustration\n          wrap\n  article__inset\n        article__inset--type-InsetMediaIllustration\n          article__inset--wrap\n    article__inset--lead\n  \"><\/p>\n<p>        <!-- eventually when we know what this card will be we can change it and leave this one --><\/p>\n<figure class=\"\n        media-object-image\n        enlarge-image\n        img-wrap\n        article__inset__image\n      \" itemscope=\"\" itemtype=\"http:\/\/schema.org\/ImageObject\"><\/p>\n<\/figure><\/div>\n<p>The latest auction of longer-dated government debt showed strong demand from yield-hungry buyers, potentially helping to allay concern among investors following weak sales of Treasuries last week. <\/p>\n<p>The highest yield, or return, accepted by investors at a Wednesday auction of<br \/>\n        20-year Treasury<br \/>\n      debt was 5.245%. That was lower than the yield of 5.26%<em>\u00a0<\/em>seen leading up to the auction, according to Tradeweb data. <\/p>\n<div class=\"paywall\">\n<p>That is a good outcome, indicating healthy demand for the 20-year debt. It means the government didn\u2019t have to entice investors with a premium over the market rate on bonds to have them buy the debt. <\/p>\n<p>Another positive indicator was the intake by dealers. Dealers, who buy up supply not taken by bidders, had to accept\u00a011.9<strong>%<\/strong> out of the $13 billion 20-year bonds sold. That\u2019s only slightly higher than the average of 9.8% dealers have had to take for 20-year bonds so far this year, according to the Dow Jones Market Data team.<\/p>\n<p>\u201cToday\u2019s 20-year auction was solid,\u201d wrote Ben Jeffery, a strategist at BMO Capital Markets.<\/p>\n<p>Coming into the sale, investors were concerned. This was the first long-dated bond auction since last week\u2019s sale of 30-year debt pointed to weak demand. Dealers had to take 18.2% of the debt on sale, the highest ratio since\u00a0February of last year.  <\/p>\n<p>The reasons are partly technical. The government has been issuing tons of debt to refill its cash coffers\u00a0after depleting them this spring, when Congress\u2019s standoff over the debt ceiling prevented the Treasury from selling new bonds. At the same time, the federal budget deficit\u2014spending in excess of revenue\u2014hit an estimated $1.7 trillion in fiscal 2023, higher than the $1.4 trillion last year, according to the Congressional Budget Office.<\/p>\n<p>Ample supplies of bonds tend to drag prices lower, which lifts yields. Bond prices and yields move inversely. <\/p>\n<p>Longer-term economic concerns such as worry about inflation have also been playing on investors\u2019 minds, pushing down prices of 10-year, 20-year and 30-year debt. The yield offered on Wednesday marked one of the highest seen on the 20-year Treasury since the series was reintroduced in the first half of 2020.<\/p>\n<p>\u201cTreasuries are now offering\u00a0some of the best valuations and highest yields we\u2019ve seen in well over a decade, which appears to have enticed a few more buyers,\u201d said Noah Wise, a senior portfolio manager for the Plus Fixed Income team at Allspring Global Investments.<\/p>\n<p>The yield on the 20-year dipped sharply to 5.198% after the results published on Wednesday\u2014a typical reaction when demand is strong\u2014but recovered to close at 5.228%. The 30-year yield was at 4.993% as of 3 p.m. on Wednesday, its highest for that point in the day since Aug. 17, 2007. The 10-year rose to 4.902%, the highest since July 25, 2007. <\/p>\n<p>All that suggests concerns remain within the fixed-income market.<\/p>\n<p>Write to Karishma Vanjani at karishma.vanjani@dowjones.com.<\/p>\n<\/p><\/div>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.marketwatch.com\/articles\/20-year-treasury-auction-demand-cd65a396?mod=markets\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The latest auction of longer-dated government debt showed strong demand from yield-hungry buyers, potentially helping to allay concern among investors following weak sales of Treasuries last week. The highest yield, or return, accepted by investors at a Wednesday auction of 20-year Treasury debt was 5.245%. That was lower than the yield of 5.26%\u00a0seen leading up [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":31818,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[33],"tags":[],"class_list":{"0":"post-31817","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>20-Year Treasury Auction Shows Strong Demand. 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