Demand was modest at today’s upsized 4-week and 52-week Treasury bill auctions, reflecting the continuation of Monday’s risk-on trade into equity assets.
The 4-week bill was sold at a high yield of 0.270%, 3 basis points cheaper than last week but richer than the 0.285% rate at the bid deadline. The coverage ratio of 3.39 fell from 3.45 last week, partially a result of the $10 billion increase in the size of the offering. This compares to the 10-auction average of 3.65 and is the lowest bid-to-cover ratio since Oct 11. Indirect bids totaled 48% versus 51% last week, while direct bids totaled 1.5% versus 5.5% last week. Dealers took 50%, up from 44% last week.
The 52-week bill was sold at a high rate of 0.695%, up from 0.680% last month and at a concession from the 0.690% yield in when-issued trading. Indirect bids totaled 35% versus 55% last month, while direct bids totaled 1.5% compared to 2.2% previously. Dealers were left taking 63%, 10% more than in October.