US sells USD 21bln of 10yr TIPS; Tail 2.8bps

• Tail: 2.8bps (prev. 1.9bps, six-auction average 1.9bps)


• High Yield: 2.438% (prev. 2.169%, six-auction average 1.928%): WI 2.410%


• B/C: 2.30x (prev. 2.52x, six-auction average 2.40x)


• Dealer: 9.86% (prev. 11.1%, six-auction average 11.5%)


• Direct: 24.98% (prev. 27.5%, six-auction average 25.6%)


• Indirect: 65.16% (prev. 61.4%, six-auction average 62.9%)

Analysis details (18:34)

Overall, a soft 10-year TIPS auction, although the bidder breakdown was more encouraging. The US Treasury sold 10-year TIPS at a high yield of 2.438%, above the prior auction's 2.169% and the six-auction average of 1.928%. The auction tailed the when-issued yield by a chunky 2.8bps, wider than both the prior 1.9bp tail and the six-auction average of 1.9bps.

Demand metrics were soft, with the bid-to-cover ratio falling to 2.30x from 2.52x, below the six-auction average of 2.40x. However, dealers were left with 9.86% of the issue, down from 11.1% previously and below the 11.5% six-auction average, suggesting end-user participation was healthier than the headline tail and bid-to-cover implied.

The bidder breakdown was mixed but generally encouraging. Indirect bidders took 65.16% of the auction, rising from 61.4% previously and above the 62.9% six-auction average. Direct participation slipped to 24.98% from 27.5%, marginally below the 25.6% average.

Overall, the chunky 2.8bp tail and below-average bid-to-cover make the auction soft on the headline despite the substantially higher real yield on offer. However, the underlying bidder composition was more constructive, with above-average indirect demand helping offset softer direct participation and leaving dealers with a below-average allocation. 

In wake of the auction, the 10-year TIPS yield rose to 4.230%, the highest level since April 2025.

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