The two year auction results confirm the poor foreign custodial participation, and the need for the excessive securities lending. Now the "dealers" (boyz) have a shitload of Old Maid Cards to unload, drat. Tomorrow $11.75 billion in temps expires, but the boyz don't need another loan especially,
ny.frb.org
they need the Fed (or foreign CBs) to buy their OMCs. A tough operation with the USD constantly sliding. Do they dare do a prem, or direct purchases (monetizing). I suppose so, no choice if the custodials don't show up. Those phone calls to Toyko and Beijing seem to be tougher sales all the time. Your clue of direct CB manipulation? Bond market upticks the rest of the week, and the USD slides. This is so predictable any more. This "market" is rigged like the Soviet Union never was. The same fate at some point too.
Treasurys tumble as auction dismays
Auction yields feeble demand from indirect bidders
By Kate Gibson, CBS MarketWatch.com
Last Update: 4:14 PM ET Dec. 29, 2004
CHICAGO (CBS.MW) - Treasury prices stumbled Wednesday as market worries of poor demand for U.S. assets materialized as the government sold $24 billion in 2-year notes.
"Yields remained elevated in the wake of the disappointing 2-year auction results, though these mostly bore out the market's worst fears in the thin market conditions," said analysts at Action Economics.
Treasury prices have dropped in recent sessions on thinking the weak dollar would dissipate overseas demand for U.S. debt. Read the currencies report.
cbs.marketwatch.com
The benchmark 10-year note fell 4/32 to 99 16/32. Its yield ($TNX: news, chart, profile), used in setting corporate and consumer loan rates, climbed to 4.31 percent from 4.3 percent in late U.S. trade on Tuesday.
Wednesday's auction had indirect bidders - including foreign central banks-buying only 34 percent of the securities sold, versus 43.5 percent indirect bidder participation in November.
Each dollar sold drew $2 worth of bids, down from the $2.61 offered for every dollar auctioned at last month's auction. The notes were sold at a high yield of 3.12 percent, the highest since mid-2002.
The results might have been skewed by less-than-average trade volume, given the usual light activity during the holidays.
"Treasury's auction of $24 billion of November 2-year notes was soft but not terrible, reflective of year-end conditions," said analysts at Ried Thunberg.
|
