Dismal, 3Y Auction Has 3rd Biggest Tail On Record, Only Covid, SVB Worse

Ahead of today's closely watched 3Y auction, many were wondering if we would see the fingerprint of a Chinese treasury boycott and/or liquidation in the results from today's sale. Well, here is the data that the Treasury released moments ago.

The sale of $58 billion in 3Y paper priced at a high yield of 3.784%, down from 3.908% last month, but massively wider than the When Issued, which at 3.760%, meant we had a 2.4bps tail. As the chart below shows, there were only two bigger tails previously: Covid, and the 2023 SVB failure/banking crisis. So yeah, superficially, this was not a good auction.

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