US sells USD 13bln of 20year bonds; Tail 0.5bps

• High Yield: 5.163% (prev. 4.927%, six-auction avg. 4.877%): WI 5.158%


• Tail: 0.5bps (prev. -1.0bps, six-auction avg. -0.3bps)


• Bid-to-Cover: 2.64x (prev. 2.75x, six-auction avg. 2.66x)


• Dealers: 14.67% (prev. 8.5%, six-auction avg. 10.1%)


• Directs: 16.21% (prev. 19.9%, six-auction avg. 23.9%)


• Indirects: 69.12% (prev. 71.6%, six-auction avg. 65.9%)

Analysis details (18:09)

Overall, a soft 20-year bond auction. The US Treasury sold USD 13bln of 20-year bonds at a high yield of 5.163%, above the prior auction's 4.927% and the six-auction average of 4.877%. The auction tailed the when-issued yield by 0.5bps, reversing the prior 1.0bp stop-through and marking the largest tail since February 2026.

Demand metrics softened. The bid-to-cover ratio declined to 2.64x from 2.75x, broadly in line with the six-auction average of 2.66x. Dealers were left with 14.67% of the issue, up sharply from 8.5% previously and well above the 10.1% average, suggesting weaker end-user demand.

The bidder breakdown also pointed to softer demand. Indirect bidders took 69.12% of the auction, down from 71.6% previously, although still above the 65.9% six-auction average. Direct bidders were awarded just 16.21%, below both the prior 19.9% and the 23.9% six-auction average.

Overall, the auction suggests the higher outright yield was not enough to fully offset investor caution. The renewed US-Iran conflict, elevated oil prices and increased geopolitical uncertainty may have tempered demand for duration, leaving dealers to absorb a larger share of the issue despite yields trading at their highest levels since May.

22 Jul 2026 - 18:02- ForexImportant- Source: Treasury Direct