Stellar 20Y Auction Stops Through Amid Surge In Foreign Demand

Moments ago the week’s lone coupon auction priced in what was a stellar sale of 20Y Treasury paper.

At 1pm ET, the US Treasury auctioned off $13BN in 20Y paper, with very solid metrics and even more solid buyside demand. 

The auction priced at a high yield of 4.817%, up from 4.664%, but below January’s 4.846%. The auction stopped 0.7bps through the 4.824% When Issued. This was the 3rd stop through auction in the past 4, following an especially ugly, tailing February 20Y auction.  

The bid to cover jumped to 2.76 from 2.36, which was also above the six-auction average of 2.63.

Internals were especially strong, with Foreign demand surging from just 55.2% in February, to 69.2% in March, the highest Indirect award since April 2025 (and obviously above the recent average of 62.1%). And with Directs taking down 21.6%, below the six-auction average of 27.0%, Dealers were left holding 9.2%, a big drop from 17.6% in February and one of the lowest Dealer allotments on record.

Overall, this was a stellar 20Y auction despite the lack of concessions in today’s session, and suggests that despite the recent selling across the curve, the bond market remains in solid shape one day ahead of the Fed’s decision to keep rates on hold (as most expect).